Oil prices edge higher
Crude prices have come down enough and seem poised to stabilize above the USD 100 a barrel level until energy traders have clarity over geopolitical developments in Ukraine and with Iran nuclear deal talks. Not enough crude demand destruction has happened to warrant prices falling below the USD 90 level and with inventories continuing to decline, this oil market will likely remain tight for quite some time.
WTI crude seems poised to continue to edge higher if no major progress happens with Ukraine-Russia talks. The Saudi Crown Prince noted the kingdom is keen on maintaining the oil market balanced and stable.
Oil prices edged higher after Secretary of State Blinken said he doesn’t see signs that Putin is prepared to stop and that the US is concerned China is considering helping Russia. This war seems like it won’t be ending anytime soon and that likely means oil prices could have another strong rally here.
Gold prices rose as investors digest the Fed’s decision and try to figure out how the war in Ukraine will impact inflation and growth. It seems risks of much more aggressive tightening by the Fed is on the table, but traders need to remember that real rates are still deeply in negative territory. Treasury curve flattening is screaming growth concerns and that should help drive some safe-haven flows towards gold.
Gold should continue to grind higher here but could find resistance around the USD 1980 level.