Almost all major industrial commodities cut prices due to uncertainty around coronavirus epidemic
It concerns oils, natural gas, but also palm oil or basic metals.
World Health Organization declared coronavirus a global health emergency. We may expect that markets, including commodity markets, will continue to fall in reaction to the announced emergency. The current situation is already negative enough for commodity investors.
Oil fell down to 3-month low this week. Its fall is mostly caused by fact that China, where the coronavirus epidemic outbreak is, represents the world’s biggest oil importer. If China’s economy weakens, oil demand will continue to fall. Natural gas is similarly affected by China’s import and its demand is lowered by mild winter.
Additionally, palm oil price fell – in 10% this week, when tradesmen reacted on expected closure of shopping malls and local restaurants in Chinese cities. Moreover, prices of industrial metals such as copper, nickel or lithium dropped. Aviation gasoline experienced significant 16% drop from Monday to Wednesday, but grew a little in the rest of the week.