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Copper Drops to Four-Week Low as Middle East Turmoil May Derail Economies
Feb 24,2011 09:29CST
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Source:SMM

Feb. 23 (Bloomberg) -- Copper fell to a four-week low on speculation that unrest in North Africa and the Middle East will derail recovering economies as oil prices jump.

Libyan leader Muammar Qaddafi vowed to fight a growing rebellion until his "last drop of blood” as bodies were left in the streets of Tripoli, the capital. Protests toppled presidents this year in Tunisia and Egypt. Oil jumped to the highest since October 2008 on supply concerns. The MSCI World Index of shares retreated for a third day.

"We’ve seen that every time we get a big jump in oil prices, it seems to manifest itself in poor economic activity and a slowdown,” said Wayne Atwell, a managing director at Casimir Capital LP in New York. "There are a lot of reasons to be anxious right now.”

Copper futures for May delivery dropped 8.5 cents, or 1.9 percent, to $4.278 a pound at 10:16 a.m. on the Comex in New York.

Earlier, the price touched $4.265, the lowest since Jan. 26.

"It’s still the unrest in North Africa and the Middle East and the uncertainty it is causing,” said Daniel Briesemann, an analyst at Commerzbank AG in Frankfurt. "That’s dampening the sentiment of market players, reflected in weak equity markets for the most part.”

Crude-oil futures for April delivery gained as much as 4.7 percent to $97.97 a barrel on the New York Mercantile Exchange, the highest since Oct. 2, 2008. Libya is Africa’s third-biggest supplier of the commodity.

Copper for three-month delivery dropped $175, or 1.8 percent, to $9,405 a metric ton ($4.27 a pound) on the London Metal Exchange. Nickel, lead, tin, zinc and aluminum also fell.

 

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