Oil lower in London, sees gains in New York

There was mixed news in the oil markets on Monday. The good news was that unions in Nigeria had called off a strike after the government agreed to their demands and froze the price of fuel for a year. Also in Nigeria, Shell (LSE: RDSA, RDSB; NYSE: RDS.A, RDS.B) said it would reopen an export terminal there that has been closed for more than a year after an attack by militants. The terminal is expected to open next month. The bad news came mostly from the United States, where worries about supplies for the summer driving season continue. Refinery utilization there is now 7.5 percent below the five-year average, and several Texas refineries reported more production losses over the weekend.

Oil prices were as mixed as the news. While July contracts for Brent crude fell 98 cents to $70.20 per barrel in London, the price for West Texas Intermediate Crude for August delivery was up 4 cents by mid-afternoon to $69.18 per barrel despite having dropped by more than $1 earlier in the session. Gasoline was also lower earlier but had added 2 cents to $2.30 per gallon by mid-afternoon. Heating oil was even at $2.05 per gallon, and natural gas fell 18 cents to $7.08 per million British thermal units.

Among base metals, three-month zinc prices were down 0.6 percent to $3,530 per tonne. Elsewhere, base metals prices were higher. Copper was 0.4 percent higher to $7,465 per tonne. While London Metal Exchange stockpiles were up by 1,200 tonnes during the day, a new strike began in Peru over the weekend. Nickel added 3 percent, to $38,800 per tonne, in after LME inventories of the metal dropped by 480 tonnes. Lead was also higher, adding 6.3 percent to $2,700 per tonne.

Meanwhile, precious metals prices were lower in early afternoon trade in New York. August gold dropped $2.30 to $654.70 per troy ounce, while July silver fell 14 cents to $12.88 per troy ounce and July platinum was $16.30 lower, trading at $1,291.70 per troy ounce.

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