Oil pares declines, gold stabilises

Oil buoyed by inventory reversal

Oil prices are back in the green on Wednesday, paring yesterday’s declines just as WTI appeared to be nearing USD 100 once more. The recovery was aided by the EIA inventory data which reversed last week’s shock 9.4 million barrel increase to register an 8 million barrel draw.

The downward revisions to growth forecasts from the IMF and World Bank in recent days weighed on oil prices after a four-day surge. The war in Ukraine and lockdowns in China were largely behind those revisions which will weigh on demand this year. Even so, with supply catching up slowly, prices are expected to remain very high for the foreseeable future.

Gold’s range shift

It’s been a turbulent few days for gold. After cruising higher for most of April to peak near USD 2,000, the yellow metal went into freefall yesterday and now appears to have stabilised around USD 1,950. This could potentially mark the new range support after a period of trading broadly between USD 1,900 and USD 1,950. High inflation is prompting more aggressive tightening and traders may be fearing more to come, not to mention the economic consequences of such policy moves.

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

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

Senior Market Analyst, UK & EMEA at OANDA
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