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Tuesday, 11 September, 2001, 19:44 GMT 20:44 UK
Oil and gold prices surge
gold bullion
Crude oil and gold bullion prices rose sharply before trading was suspended on most major world exchanges after devastating terrorist attacks in the US.

Oil prices jumped nearly $4 a barrel in London, following the explosions at New York's World Trade Center.

It's going crazy here. It's worse than the Gulf War

Rob Laughin, oil trader

The price of gold bullion jumped by $16 an ounce in London in panic buying after the attacks.

One London-based oil broker, Rob Laughin, of GNI, told BBC News Online: "It is going crazy here. It is worse than the Gulf War."

The main American stock markets, including the Nasdaq and the New York Stock Exchange, announced that they would remain closed throughout Wednesday.

The US treasury bond markets will also be closed for business.

Brent drops back

The price of the benchmark Brent crude oil dropped back below $30 a barrel when trading on London's International Petroleum Exchange (IPE) resumed after a one hour suspension.

By 1600 GMT, October Brent was trading $1.95 up at $29.40, well down from the high of $31.05 a barrel hit shortly after the attacks, the highest price since December 2000.

Officials from the Organisation of Petroleum Exporting Countries (Opec) said the group was committed to ensuring stability in world oil markets.

Seeking refuge

Analysts said prices of commodities often rise during periods of global instability, as investors seek refuge in tangible assets.

Robin Bahr, metals analyst at Standard Bank, London, said: "There is panic buying of metals, gold and oil - it is complete pandemonium.

"Gold and oil have gone up and it is a drive towards safe haven territory."

Gold soared nearly 6%, or $16, an ounce after the attacks, with the London benchmark fixing price climbing to $287 in the afternoon from the morning's benchmark $271.

At 1515 GMT, when European trading ended, gold spot prices were quoted at $289.80/290.30 an ounce, up from Monday's New York close of $271.40/271.90.

There was pure panic. The gold price went through the roof

Neil Stacey, trader at Cazenove

Oil giants BP and Shell and defence company BAE Systems were the only three among the UK's top 100 listed firms to see their shares rise on Tuesday.

In Johannesburg, a big world centre for gold trading, gold prices leapt to $289.9 an ounce from $271.15.

"There was pure panic. The gold price went through the roof and stocks have plunged," said Neil Stacey, a trader at Cazenove in Johannesburg.

Nymex evacuated

The world's largest physical commodities exchange, the New York Mercantile Exchange (Nymex), is situated a few hundred metres from the World Trade Center.

None of these things change OPEC's decision to guarantee the stability of the oil market

Opec Secretary General Ali Rodriquez

It had not yet opened for business when the planes hit the World Trade Center at about 0900 local time, but its trading floor was immediately evacuated and trade suspended.

Nymex bosses decided not to open the ACCESS electronic trading system at 2000GMT as usual.

Speaking from home, a Nymex spokesman said: "No decision has been made to cancel the session at this point, but we are definitely going to delay it."

The decision to suspend ACCESS was taken following an afternoon conference call.

Trading was also suspended for the day at the Chicago Mercantile Exchange (CME) in the immediate aftermath of the attack.

Opec response

Opec Secretary General Ali Rodriguez said the oil exporting cartel was committed to ensuring stable oil supplies following the attack.

Mr Rodriguez said: "None of these things change OPEC's decision to guarantee the stability of the oil market."

"OPEC member countries are committed to their promises to guarantee sufficient oil supplies," he added.

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