RUBBER-Japan futures rally as oil rises; Shanghai nearly hits upper limit on tight supply

By Ruth Chai

Jan 23 (Reuters) -

• Japanese rubber futures jumped on Friday as global oil prices rebounded, while Shanghai's most-active butadiene rubber contract nearly hit the upper daily price limit on tight supply and robust demand.

• The Osaka Exchange (OSE) rubber contract for June delivery JRUc6, 0#2JRU: was up 4.2 yen, or 1.19%, at 357.3 yen ($2.25) per kg.

• The contract rose 1.48% this week, logging a seventh consecutive weekly gain.

• The rubber contract on the Shanghai Futures Exchange (SHFE) for May delivery SNRv1 rose 520 yuan, or 3.29%, to 16,315 yuan ($2,343.20) per metric ton.

• The most-active March butadiene rubber contract on the SHFE SHBRv1 gained 845 yuan, or 6.99%, to 12,930 yuan per ton, close to the daily fluctuation limit of 7%.

• The contract has gained 5.96% week-on-week.

• Oil prices rebounded on Friday after U.S. President Donald Trump renewed threats against major Middle Eastern producer Iran, raising concerns of military action that could disrupt supplies. O/R

• Natural rubber often takes direction from oil prices as it competes for market share with synthetic rubber, which is made from crude oil.

• Butadiene prices rebounded on tight spot supply and auction premiums, which lifted production costs for butadiene rubber factories, while robust downstream demand tightened feedstocks further, according to a report by Guoyan Futures Research.

• Meanwhile, weather woes in top producers Thailand and Indonesia have tightened natural rubber supply, which lifted prices and improved sentiment for synthetic rubber, the report said.

• Coupled with an overall positive sentiment for commodities, butadiene rubber prices saw a persistent increase this week, it said.

• The front-month rubber contract on Singapore Exchange's SICOM platform for February delivery STFc1 last traded at 185.80 U.S. cents per kg, up 2.3% as of 0700 GMT.

($1 = 158.6900 yen)

($1 = 6.9627 yuan)