Commodities rattled by stubborn demand fears

LONDON, May 14 (AFP): Commodity markets experienced another volatile week, with New York oil prices diving again, as traders eyed stubborn demand fears in consumer nations and tracked sharp fluctuations in the dollar. Most raw materials had already slumped in value the previous week on the back of downbeat economic data and fears of weak energy demand in the United States and elsewhere. Oil: New York crude sank even lower on the back of mounting concerns that high price levels could erode demand. Oil began the week on the front foot, gaining ground on Monday as dealers snapped up bargain crude after a large drop the previous week. Prices carried on climbing Tuesday, encouraged by strong trade numbers from China that showed its economy still growing strongly. Meanwhile, the OPEC cartel held unchanged its forecast for world oil demand growth this year, saying rising consumption in China would make up for the uncertain outlook in the United States and in quake-hit Japan. But Thursday, the International Energy Agency cut its outlook for 2011 global oil demand growth by 190,000 barrels per day because of high oil prices and weaker recovery in rich countries. There were also concerns over oil demand in China, the world's biggest energy consumer, as Beijing ramped up efforts to tame inflationary pressure in the world's second biggest economy. But New York prices slid back underneath $99 per barrel heading into the weekend. Precious Metals: Gold and silver witnessed highly volatile trade, rebounding sharply before diving lower on demand fears, but ended the week in positive territory on the back of the weaker dollar. By late Friday on the London Bullion Market, gold rose to $1,506 an ounce from $1,486.50 the previous week. Silver rallied to $36.20 an ounce from $34.20. On the London Platinum and Palladium Market, platinum decreased to $1,774 an ounce from $1,789. Palladium slid to $718 an ounce from $721. Base Metals: Industrial metals traded mixed amid concerns over the strength of demand from Asian powerhouse China. By late Friday on the London Metal Exchange (LME), copper for delivery in three months rose to $8,825 a tonne from $8,804 the previous week. Three-month aluminium dipped to $2,600 a tonne from $2,615. Three-month lead firmed to $2,325 a tonne from $2,290. Three-month tin slipped to $29,100 a tonne from $29,350. Three-month zinc rose to $2,168 a tonne from $2,140. Three-month nickel increased to $24,600 a tonne from $24,405. Cocoa: Prices held steady amid easing concerns over Ivory Coast, which is the biggest producer of the commodity that is mostly used to make chocolate. In New York on the NYBOT-ICE, cocoa for July increased to $3,042 a tonne from $3,024. Coffee: Prices beat a retreat after recently striking 34- year peaks on persistent concerns over tight supplies. By Friday on NYBOT-ICE, Arabica for July slid to 275.50 US cents a pound from 291.30 cents the previous week. On LIFFE, Robusta for delivery in July stood at $2,510 a tonne compared with $2,576. Sugar: The market crept higher after two weeks of losses. By Friday on NYBOT-ICE, the price of unrefined sugar for delivery in July rose to 21.83 US cents a pound from 20.95 cents the previous week. On LIFFE, the price of a tonne of white sugar for August increased to o609 from o580.40. Rubber: Prices picked up slightly on renewed buying interest as traders returned to the market amid expectations of rising Chinese demand and higher prices of crude oil, which is a component of synthetic rubber. The Malaysian Rubber Board's benchmark SMR20 rose to 442.85 US cents per kilo from 439.95 cents last week.