Zephyrnet Logo

Oil edges lower, gold stabilizes

Date:

FacebookTwitterEmail

Oil edges lower but market remains extremely tight

Oil prices are slipping for a second day as it’s become clear that the EU is not about to agree on a ban on Russian oil imports, no matter how much it would like to follow the actions of the US. While it would be devastating for Russia, it would also be so for European countries as there isn’t exactly an abundance of affordable oil out there. A few countries are particularly reliant on Russia and will need time to change that.

The market is going to remain extremely tight though and the loss of a million barrels per day of crude from Kazakhstan via the Caspian Pipeline Consortium (CPC) doesn’t help matters. The EU failing to agree a ban may provide temporary relief but it doesn’t change the path of travel which is strong demand and declining supply and there’s little indication of that improving, with the rest of OPEC+ happy to turn a blind eye, in the absence of Kremlin support.

Gold steadies after latest jump

Gold is hovering around USD 1,950 at the end of the week after hitting 10-day highs on Thursday. The gains over the last couple of days appeared to be driven by moderate risk-aversion in the markets and higher energy prices. Ultimately, the moves were relatively small compared to what we’ve seen over the last couple of months so perhaps it’s not worth reading too much into it.

The yellow metal will continue to be well supported against the backdrop of sky-high inflation and immense uncertainty. That doesn’t necessarily mean we’re heading for record highs, which we currently sit a little more than 5% below. But, as is the case more broadly right now, the main catalyst continues to be the constant flow of headlines which will continue to determine the path of travel for the yellow metal. 

spot_img

Latest Intelligence

spot_img