Gold Shines Again Amid Trade Tensions… Oil Falls Under Russian Pressure:
The week began with turmoil in the financial markets,
gold prices surged to new record highs driven by growing demand for safe-haven assets.
In contrast, oil prices fluctuated following sharp remarks from U.S. President Donald Trump against Russia,
raising fears of further escalation in geopolitical tensions.
Contents
Gold Surges to Record Levels
Oil Markets Under Pressure
Market Outlook Summary
Gold Surges to Record Levels Amid Rising Trade War Fears
Gold prices continued their upward trajectory, surpassing $3,093 per ounce,
breaking the previous record set last Friday, when the metal closed higher for the fourth consecutive week.
This rally comes ahead of an expected announcement from the White House
regarding a new round of reciprocal tariffs following Trump’s recent decision to impose 25% tariffs on car imports.
Since the beginning of 2024, gold has climbed over 17%, hitting at least 15 new record highs.
This has been driven by heavy central bank purchases and growing demand
for hedging instruments amid rising economic and political uncertainty.
Despite reduced expectations for further Federal Reserve interest rate cuts,
with markets now pricing in only two quarter-point cuts,
gold continues to attract investors as a non-yielding asset that performs well during times of instability.
In this context, Goldman Sachs raised its forecast for gold to $3,300 per ounce by year-end,
citing strong central bank demand and increasing flows into gold-backed ETFs.
As of 6:17 AM Singapore time, spot gold was trading up 0.2% at $3,092.49 per ounce,
while the Bloomberg Dollar Spot Index slipped by 0.1%.
Meanwhile, silver and platinum held steady, and palladium slightly declined.
Oil Markets Under Pressure Amid Trump’s Threat of Sanctions on Russia
In contrast, oil prices experienced significant volatility on Monday
after President Trump expressed he was “very angry” with Russian President Vladimir Putin,
threatening to impose strict sanctions on Russian oil exports if a ceasefire agreement with Ukraine is not reached.
Brent crude futures for June delivery traded below $73 per barrel,
while West Texas Intermediate (WTI) hovered around $69.
In an interview with NBC News, Trump stated:
“If I believe Russia is responsible,
then anyone buying oil from them will not be allowed to do business in the United States.
We will impose 25% tariffs on all oil shipments, potentially reaching 50 percentage points.”
These remarks signal potentially far-reaching consequences for the global energy market.
As Russia is one of the world’s top three oil producers,
any move to sanction its exports could result in major supply chain disruptions,
especially for major importers like India and China,
which have been the largest buyers of Russian oil since the war began.
Russia’s crude oil exports hit their highest level in five months in March.
U.S. sanctions on Russian oil tankers have begun to show signs of weakening,
adding further complexity to the global energy picture.
Market Outlook Summary
Gold remains the top beneficiary as markets seek clarity amid heightened political and economic tension.
Meanwhile, energy markets are bracing for potential developments that could reshape global supply chains.
Gold Shines Again Amid Trade Tensions… Oil Falls Under Russian Pressure
