Shanghai fuel oil futures contracts yesterday touched an all-time high since trading began in 2004, tracking the rocketing international crude oil price, which shot to a record high of $117 per barrel last Friday.

The most actively traded fuel oil futures contract for delivery in July on the Shanghai Futures Exchange (SHFE) soared to 4,519 yuan per ton, a record, in the morning session, after dropping slightly to close at 4,440 yuan, with the transaction volume increasing 143 percent from the previous trading day to 52,058 hands.

The price of fuel oil contract for July delivery has climbed an aggregate 3 percent in the past two weeks.

Meanwhile, on the New York Mercantile Exchange, the most actively traded crude oil futures contract for delivery in June rose 0.23 percent to $116.84 in yesterday's electronic trading.

Analysts said an anticipated further weakening of the US dollar helped push up the prices of crude oil and a wide range of other commodities, including non-ferrous metals.

But prices of non-ferrous metals in the domestic market have trailed those in the international markets.

"Compared with the stronger upward momentum in the global markets, the domestic nonferrous metals market is likely to become more volatile as uncertainties are overhanging the supply and demand equation and investors are not sure about the market trend in the future," said Jing Chuan, an analyst at Great Wall Futures Co.

On SHFE, the most actively traded copper futures contract for July delivery kept fluctuating from 62,000 yuan to 64,000 yuan during the past month, while the price of three-month copper futures on London Metals Exchange has climbed 9.1 percent over the past month.

"The continuous depreciation of the US dollar will lend support to the price rise of dollar-denominated commodities in the global markets in the longer term," said Jing Chuan of Great Wall Futures Co.

But he added that a temporary oversupply of copper in the domestic market resulting from a big increase in import in the past several months would keep copper prices fluctuating in a relatively wide range.

Latest Customs figures show the country's total import of refined copper and copper materials in April amounted to 240,000 tons, up 6 percent from the a year earlier.

"For many domestic small and medium-sized metals processors, the shortage of capital resulting from a tightening monetary policy has lowered their capabilities to consume metals and expand production," said Jing.

"Copper futures prices are expected to fluctuate within a range of 63,000 to 67,000 yuan per ton in the coming months," said Liu Chao, an analyst at Xiangcai Qinian Futures Co.

(China Daily April 22, 2008)