Oil higher on demand optimism, gold hovers near highs

Oil

Crude prices are higher as economic optimism grows for not just China, but also the eurozone. The oil market is digesting a global slowdown that might not be as bad as feared. ​ Energy traders still believe that OPEC+ will do whatever is needed to keep prices supported and that includes more production cuts this quarter. ​

Oil seems like it wants to waver right now until we get a better handle on China’s Covid surge. ​ As China battles an unprecedented surge in Covid cases, everyone wants to see if travel continues to rebound. ​

Oil got a minor boost as the pared gains after Fed Chair Powell did not deliver his best hawkish hits at a Riskbank event. ​ ​

Gold

Gold prices are holding near recent highs as traders grow optimistic the Fed won’t be able to follow through with its hawkish threats. Fed Chair Powell’s appearance at a Riksbank event was really a non-event as he didn’t focus on monetary policy. The next big move in gold seems like it will have to wait until this week’s inflation report. ​

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