Oil volatile, gold rallies

Oil

Initially crude prices were unable to hold onto early gains after the EIA short-term energy outlook trimmed their demand outlook for gasoline and distillates. ​ Earlier, oil was rallying after a couple bullish calls from Goldman Sachs and Morgan Stanley. ​ Goldman raised their third-quarter Brent price forecast from USD 125/bbl to USD 140/bbl, while Morgan sees Brent reaching USD 130/bbl, with the upside potentially testing USD 150/bbl. ​ ​

The oil market is expected to remain tight as the supply side will continue to tell a story of low inventories. Crude oil inventories will likely post more draws as driving season and vacationing heats up. ​ ​

China’s COVID situation doesn’t seem like it may continue to head in the right direction. ​ With President Xi potentially attending Hong Kong’s July 1^st handover anniversary, no one is expecting Hong Kong to go into lockdown.

Oil surged late after the US issued a statement to the IAEA board that suggested a revival of the Iran nuclear deal is still not any closer to happening. The US said, “What we need is a willing partner in Iran. In particular, Iran would need to drop demands for sanctions lifting that clearly go beyond the JCPOA and that are now preventing us from concluding a deal.”

Gold rallies as risk appetite dips

A lot of doom and gloom was good news for gold. Target’s second profit warning in 20 days and a downbeat outlook from the World Bank were just what gold needed to muster up a rally. ​ Treasury yields are also down sharply after yesterday’s surge, which is welcome news for bullion holders.

Gold is likely to consolidate around the USD 1840-1870 level leading up to Friday’s inflation report.

• Coinsmart. Europe’s Best Bitcoin and Crypto Exchange.
• Platoblockchain. Web3 Metaverse Intelligence. Knowledge Amplified. FREE ACCESS.
• CryptoHawk. Altcoin Radar. Free Trial.
• Source: https://www.marketpulse.com/20220607/oil-volatile-gold-rallies/