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Commodities markets summary

A summary of trading in key commodities markets overseas:

ENERGY

Oil prices have dipped following mixed US crude-inventory data and reports suggesting an OPEC production cut is unlikely when the organisation meets in November.

US benchmark West Texas Intermediate for October delivery shed 46 cents to close at $94.42 a barrel on Wednesday on the New York Mercantile Exchange.

European benchmark Brent oil for November delivery slipped eight cents to $98.97 a barrel in London.

US crude inventories unexpectedly increased by 3.7 million barrels for the week ending September 12, according to the Department of Energy. Analysts had expected inventories to fall by 1.2 million barrels, a survey by Dow Jones Newswires showed.

However, John Kilduff, founding partner at Again Capital, said the surprising increase in crude stocks was countered somewhat by other aspects of the US oil-supply report.

The report showed a drop of 1.6 million in gasoline stocks, whereas analysts had expected the level to be unchanged.

Analysts also cited a decline in oil inventories in Cushing, Oklahoma, a key trading hub.

PRECIOUS METALS

Gold prices extended their losses on Wednesday as the dollar strengthened and traders mulled the Federal Reserve's policy statement.

Gold for December delivery, the most active contract, was recently down $12.40, or one per cent, at $1,224.30 a troy ounce in electronic trading on the Comex division of the New York Mercantile Exchange.

The December contract had settled at $1,235.90 an ounce when gold trading on the Comex floor ended roughly half an hour before the Fed's policy statement was released.

Fed officials cut monthly bond purchases by $10 billion, advancing the central bank's plans to conclude the stimulus effort at its next meeting, in October.

Most officials, 14 of 17, said they continue to believe the first increase in short-term interest rates will occur in 2015.

In response, the dollar rallied against other currencies while gold prices fell to $1,222.80 in electronic trading, a fresh eight-month low, extending earlier losses.

BASE METALS

Copper futures closed higher on the London Metal Exchange, treading water ahead of the US Federal Open Market Committee meeting statement later Wednesday.

The LME's three-month copper contract rose 0.4 per cent to be at $6,930.00 a metric ton at the PM kerb close.

The FOMC meeting statement is expected to shed light on the direction of US monetary policy, which is likely to affect the base metal's price given the standing of the US as the world's number two consumer of copper after China.

"With the FOMC meeting this evening and quite a lot of chatter regarding US interest-rate expectations, the metals have unsurprisingly opted to consolidate and tread water," said Leon Westgate, an analyst at Standard Bank.

Copper prices also continued to ride a wave of support on news that the People's Bank of China injected 500 billion yuan ($81 billion) to aid the top five state-owned banks, as it moved to counter slower-than-expected growth.