Steadying after a rough week
Oil prices are creeping higher again this morning after steadying on Thursday. They came under some pressure over the previous 48 hours amid concerns about China’s economy over the next quarter or two. A lack of trustworthy data doesn’t help that situation but with Covid spreading so rapidly throughout the country, it’s likely there’s going to be disruption at the very least that will hamper economic activity and demand.
That will likely change in the second half of the year and the economic rebound could fuel more demand for crude and see prices rise once more. The state of the rest of the global economy by that point will determine just how supportive that would be for the price, among other things of course like Russian output and OPEC+ as a whole.
Strong jobs report could be a big blow
Gold pared gains on Thursday before steadying today ahead of the US jobs report. It remains very elevated after a strong start to the year and some weakness in wages and job growth could spark the rally back to life once more.
Of course, another strong jobs report could see its fortune shift the other way and push it back into a corrective phase after a strong recovery since early November. It appeared to be gearing up for a correction late last year but lower yields this week have given it a new lease of life. That could be quickly undone by another strong report.
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