Oil and gold continue to lose ground

Oil slips further below USD 100

Oil prices are continuing to fall in the middle of the week as progress in talks between Ukraine and Russia see crude premiums being eroded. Whether that’s premature or not, we’ll soon see, especially with disruptions already being reported in recent weeks.

While an end to the fighting will reduce the cloud of uncertainty for the global economy, it will not put an end to the sanctions that have already been imposed on Russia, or any that will follow. That could still mean high commodity prices for an extended period which means high inflation and more cost pressures for households and businesses.

Of course, the fall in oil prices is being helped lower by lockdowns in China and reports of a new nuclear deal being almost agreed which will go some way towards easing the imbalance in the markets. Not to mention calls by Libyan Prime Minister Abdul Hamid Dbeibah for OPEC+ to increase production targets, which come following similar comments from the UAE recently.

Gold sell-off slowing near USD 1,900

Gold has continued to drop also, although the pace of declines has slowed somewhat as the price approached USD 1,900. That’s quite the fall from last week’s peak; it’s just a question of whether that will continue given the environment is still so uncertain and inflation remains sky-high. We could see it stabilise back around USD 1,900 where it was trading prior to the invasion.

For a look at all of today’s economic events, check out our economic calendar: www.marketpulse.com/economic-events/

Content is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Business Information & Services, Inc. or any of its affiliates, subsidiaries, officers or directors. If you would like to reproduce or redistribute any of the content found on MarketPulse, an award winning forex, commodities and global indices analysis and news site service produced by OANDA Business Information & Services, Inc., please access the RSS feed or contact us at info@marketpulse.com. Visit https://www.marketpulse.com/ to find out more about the beat of the global markets. © 2023 OANDA Business Information & Services Inc.