Russia Suspends Flow Through The Nord Stream 1 Pipeline, Cotton Futures, Gold Prices Increase For The First Time In 3-weeks
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Summary:
- NGAS futures rise in the wake of suspension of Nord Stream 1 pipeline.
- A stagnant dollar and safe-haven buying prompted by economic uncertainty boosted bullion demand.
NGAS futures increasing
The second week of September saw a small increase in US natural gas futures, recovering from the 6% drop the previous week to keep pace with the rise in the European benchmark following the indefinite suspension of Russian gas exports through the Nord Stream 1 pipeline. The action reversed the prior declaration by Russian supplier Gazprom that flows will start up again on Saturday after a maintenance outage, adding to worries over Europe's energy shortage before the winter. Meanwhile, a string of heatwaves that have hit the US this summer have increased demand for gas-fired power facilities. Freeport LNG announced that the launch of its Quintana export project would be postponed until November.
NGAS Oct ‘22 Futures Price Chart
Cotton Futures
Trading on a contract for difference (CFD) that monitors the benchmark market for this commodity shows that cotton has dropped 3.01 USd/Lbs, or 2.67%, since the start of 2022.
Cotton Dec ‘22 Futures Price Chart
Gold futures rising
After falling for the previous three weeks, gold prices increased above $1,710 an ounce on Tuesday as a stagnant dollar and safe-haven buying prompted by economic uncertainty boosted bullion demand. As traders took some profits and anticipated this week's speeches by Federal Reserve officials and policy announcements from other significant central banks, the dollar's unrelenting rally came to a halt. Following the announcement that gas shipments via the crucial Nord Stream 1 pipeline will not resume, a worsening energy crisis in Europe also rekindled recessionary fears, prompting investors to seek for safer assets. As the Federal Reserve is anticipated to continue with aggressive interest rate hikes to combat excessive inflation, gold is likely to remain under pressure. On Tuesday, the Reserve Bank of Australia also announced its fourth consecutive 50 basis point rate increase, and later this week, the European and Canadian central banks are expected to do the same.
Gold Dec ‘22 Futures Price Chart
Sources: finance.yahoo.com, tradingeconomics.com
