Commodities mixed as Libya's uprising continues

AP News
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Posted: Feb 24, 2011 4:26 PM
Commodities mixed as Libya's uprising continues

Commodity prices were mixed Thursday on questions about the impact Libya's uprising may have on demand for wheat, corn and other products.

Wheat, corn and soybeans fell while most metals rose. Oil prices settled at $97.28 a barrel after climbing to $103.41 a barrel earlier in the day on the New York Mercantile Exchange. It was the first decline in nine days.

In Libya, foreign mercenaries and Libyan militiamen loyal to Moammar Gadhafi tried to roll back the uprising against his rule even as rebels claimed more territory.

Gadhafi's crackdown has been the harshest in the wave of protests that has swept the region the past month. The leaders of Libya's neighbors, Egypt and Tunisia, have both been ousted.

Meanwhile, the International Energy Agency said it can make up for any lost shipments from Libya by tapping into large surpluses held by member countries, which include the U.S., the United Kingdom, France and Germany.

A key question for investors is whether oil prices will continue to climb because of the continuing unrest in the region, which could disrupt the flow of oil.

"The higher energy prices go, the more it's going to sap demand for other commodities," LaSalle Futures Group analyst Matt Zeman said. "As people feel the pinch in terms of energy costs, they're going to scale back spending everywhere else to accommodate that."

That concern weighed on wheat and, to a lesser extent, corn and soybeans. In contracts for March delivery, wheat fell 15.75 cents to settle at $7.825 a bushel, corn lost 5.75 cents to $6.965 a bushel and soybeans fell 2.25 cents to $13.2925 a bushel.

In Nymex trading in March contracts, heating oil fell 2.34 cents to settle at $2.8932 per gallon and gasoline added 0.72 cent to settle at $2.8749 per gallon. Natural gas lost 6.4 cents to settle at $3.872 per 1,000 cubic feet.

Metals prices mostly rose. In contracts for March delivery, silver fell 13.2 cents to $33.166 an ounce, palladium rose $3.20 to settle at $777.75 an ounce and copper added 5.1 cents to $4.3265 a pound.

April platinum rose $10.10 to settle at $1,786.80 an ounce and April gold gained $1.80 to settle at $1,415.80 an ounce.