IKS-RUSSIA

Highlighting the high level of oil inventories in the developed world and weakness in US petrol demand this summer, Opec said: “Despite the recent positive developments in crude prices, the market is fundamentally weak.” Although China on Tuesday reported July as a record month for crude imports, Opec said it expected Chinese oil demand to rise only 100,000 barrels a day this year to average 8.05m b/d in 2009. Following an increase of more than 50 per cent in oil prices this year, Opec’s members will meet in September in Vienna to review production quotas. The US Energy Information Administration on Tuesday lowered its 2009 world oil demand estimate. In its new monthly energy forecast, the EIA said it expected global oil consumption to drop 1.71m b/d to a revised 83.76m b/d this year compared with 2008. In July, the agency had estimated that petroleum demand would fall 1.56m b/d in 2009.  Some analysts had expected the EIA to bolster its world oil demand forecast based on some positive economic reports that had pushed oil prices up to $70 per barrel this week.  Sugar prices extended the previous session’s strong gains. Liffe October white sugar rose 0.5 per cent to $560.0 a tonne following a jump of 3.8 per cent in the previous session. ICE October raw sugar, the global benchmark, added 0.6 per cent at 22.12 cents a pound after jumping 5.7 per cent in the previous session.  Raw sugar prices hit 22.44 cents a pound in the previous session, the highest level since mid-1981, amid concerns about low global stocks and bad weather affecting output in Brazil and India, the world’s two largest sugar producers. Traders said physical buyers were believed to be waiting in the wings, hoping for a correction.  IntercontinentalExchange increased initial sugar margin requirements from $900 a lot to $1,400 for commercial market participants and from $1,260 to $1,960 for speculators, effective from Tuesday’s close following the dramatic increase in the market’s volatility over the past week. Orange juice prices jumped 3.9 per cent to $1.11 cents a pound, up 43.2 per cent since the start of July amid concerns that production in Florida this year could prove disappointing. Florida produced 162.1m boxes in 2008-09 [a box weighs 90 pounds] but market talk suggests output could decline to 155m boxes. Two key reports next week should provide greater insight into this year’s crop prospects ahead of the US government’s first update, due out in October.  In Chicago, traders awaited the US Department of Agriculture August crop report, due out on Wednesday. CBOT September corn rose 1¾ cents to $3.26 a bushel while CBOT September wheat dipped 4½ cents to $4.98¾ a bushel and CBOT August soyabeans increased 29½ cents to $12.