Mining Review Sunday Update 27th February 2022

War in the Ukraine is dominating the markets, and one beneficiary has been gold, as it always in in times of crisis and uncertainty. The others are oil and natural gas.

With the FED now possibly looking for a .25% rate rise, gold should receive an extra boost.   […[

 

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Mining Review Sunday Update 27th February 2022

War in the Ukraine is dominating the markets, and one beneficiary has been gold, as it always in in times of crisis and uncertainty. The others are oil and natural gas.

With the FED now possibly looking for a .25% rate rise, rather than the mooted .5%, gold should receive an extra boost.

Russian produces a range of metals, including aluminium, nickel, palladium, and platinum.

Russia and Ukraine also produce around 90% of the world’s NEON GAS, used in semiconductors. Any disruption to supply here could cause car factories to close, as they need the semiconductors for their engine management systems.

Russia’s exports broken down by sector can be viewed here.

Let’s hope sanity prevails and the fighting stops.

 

This is a brief update as the full Monthly Review will be published on Monday.

 

Stocks on out watchlist in the news

  Silver Tiger Announced the El Tigre Mine Rehabilitation

  Ascot Resources Announces C$56 M Bought Deal

  Rumble Resources Delivered High Grade Continuity

  Calidus Confirmed the Formation of Pirra Lithium

  Ascot Resources Drilled High-Grade Gold at Big Missouri

  Uranium Energy Corp. 2022 Letter to Shareholders

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Precious metals

Gold	1889	2%
Silver	24.25	1%
Palladium	2367	1%
Platinum	1059	4%
Rhodium	19750	-1%

 

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Base metals

Copper	4.53	-2%
Nickel	11.84	0%
Zinc	1.66	-4%
Tin	20.77	-2%

 

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Energy metals

Cobalt	33	0%
Manganese	3.47	-1%
Lithium	71085	10%
Uranium	45.05	1%

 

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Bulk commodities

Iron Ore	139.1	-14%
Coking Coal	419	-3%
Magnesium	7519	-5%

 

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Metal ETF’s

GDX	34.39	6%
GDXJ	42.92	3%
Sil	35.26	2%
SILJ	12.85	2%
GOEX	29.86	3%
GLD	176.55	2%
COPX	41.89	0%

 

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The Mining Review Sunday Update for the 27th February is complete

 

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City Investors Circle is based in the financial district in the City of London

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The price of WTI crude fell to $33.54 after close in the USA tonight, as the price falls inexorably towards the now highly expected $30 mark.

The cause for this new fall after a few days respite when the price regained some of the previous months losses may have a political rather than economic root cause.

 

Has political skulduggery caused the latest fall in the oil price?

 

After such a dramatic fall in the price of oil over the past year, a bounce was on the cards and duly occurred a couple of weeks ago, and predictions that the price had  “bottomed” and “stabilised”  were abundant in the media and financial  press.

 

I did not buy the “bottom” theory, due to the rapidly slowing world economy, and the fact that the deep pocketed Saudis seem to be trying to wipe out high cost American shale oil producers, and have sufficient reserves to keep the pressure on for a lot longer.

 

Now a new theory has emerged, and quite a plausible one at that. This is that countries such as Italy received about 12 – 14% of their oil from Iran, which was embargoed during the dispute about their nuclear program. As a result, Saudi crude filled the void caused by the non delivery of Iranian oil.

 

Now that Iran is preparing to restart oil exports, they are naturally looking to supply their traditional customer such as Italy. The Saudis, who are locked in many disputes with Iran in the Middle East, want to inflict as much pain as possible, and are rumoured to have wooed the Italians with a discount offer to maintain their custom, rather than them switching back to Iran.

 

If this rumour is true, it not only explains the falling oil price, but raises the stakes significantly in the proxy wars being fought between these two countries. When one considers that similar action by the Kuwaiti government was the trigger for the Iraqi invasion, the danger here becomes clear.

 

let’s hope clear heads pull everyone back from the brink, because we seem to be edging closer every day.

 

Ironically, if direct hostilities commence, the price of oil is likely to escalate significantly in short order as the danger to world supplies would be immense.