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Oil gains ground, gold hovers at 2K

Oil cautiously higher after mixed messages from UAE

Oil prices are rising again, up around 4% on the day at one point, as talks between Ukraine and Russia give little cause for optimism. The risk of further disruption remains high, especially with more sanctions to come that will make life harder for Russia and companies less keen to do business with them.

The one ray of hope comes from the UAE, following comments yesterday that suggested they favour higher output. That was tempered later, though, by the country’s energy minister who reaffirmed their commitment to the OPEC+ agreement, so who knows where that leaves us. One dissenting voice within the group could at least spark more discussion about the need for higher production, although I can think of one influential member that may fiercely oppose it.

Gold should remain supported and could take another run at the highs

Gold is hovering around USD 2,000 after plunging on Wednesday as part of the big risk-reversal we saw across the markets. It’s not made up an enormous amount of ground today, despite commodity prices heading higher and risk aversion sweeping through the markets once more.

While the talks today yielded no positive outcome and both sides still seem miles apart in their expectation, it seems the very fact that these discussions are taking place and at a high level is providing some hope. Gold should still remain well supported unless we see any real breakthrough and while it may have just failed at the first time of asking, record highs may not be far away.

This article 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 Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Craig Erlam

Craig Erlam [4]

Senior Market Analyst, UK & EMEA at OANDA [5]
Based in London, Craig Erlam joined OANDA in 2015 as a market analyst. With many years of experience as a financial market analyst and trader, he focuses on both fundamental and technical analysis while producing macroeconomic commentary. His views have been published in the Financial Times, Reuters, The Telegraph and the International Business Times, and he also appears as a regular guest commentator on the BBC, Bloomberg TV, FOX Business and SKY News. Craig holds a full membership to the Society of Technical Analysts and is recognised as a Certified Financial Technician by the International Federation of Technical Analysts.
Craig Erlam
Craig Erlam

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