Strong US Employment Data Gives WTI Crude Oil a Chance to Rebound

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Commodities Trading

: 07 March 2014

Stronger than estimated results for US unemployment benefits spilled over into the energy complex, giving WTI crude oil a chance to rebound.

The subsequent rally of $0.99 to $101.95 per barrel was also helped by a weaker dollar and gains for the stock markets.

On top of that, the lingering risk of conflict in Ukraine continues to add a risk premium for oil prices.

The turmoil in Ukraine, with Crimea due to hold a vote on joining Russia, looks set to continue and so offered gold investors a reason to buy back in.

The precious metal climbed by $14 to $1,350.9, with its short-term outlook remaining strong.

It will be interesting to see whether a really good US unemployment number can turn gold's fortune around.



Commodities Trading

: 06 March 2014

A larger than expected build in US crude oil inventories was largely responsible for yesterday's steep sell off in WTI prices.

In addition, the tumble of $2.42 to $100.95 per barrel was accentuated by disappointing US economic data, which included weak employment sector figures that may signal trouble for Friday's NFP.

Although it might have lost some steam recently, the gold market continued to head higher yesterday, gaining $2.4 to $1,336.9.

The conflict in Ukraine is certainly far from resolved, despite attempts to bring both sides together, so investors feel safer moving into precious metals.

We shall see if the rest of the week can really disturb gold's current bullish stance.



Commodities Trading

: 05 March 2014

WTI crude oil gave back most of Monday's gains on the back of speculation that Putin's comments made a conflict between Russia and Ukraine less likely.

There are widespread reports that both sides might not be keen for inflating the tensions on the ground, despite the ongoing exchanges of heated rhetoric.

Following the energy sector, the precious metals took a steep tumble as the perceived reduction in geopolitical risk pushed financial spread betting investors to the exit doors and into higher yielding assets.

As such, gold prices retraced $16 to reach $1,334.5, with the attention probably shifting towards the ECB and Bank of England interest rate meetings and the Non-Farm Payrolls report in the US.



Commodities Trading

: 04 March 2014

Amid continued uncertainty surrounding the conflict between Russia and Ukraine, US crude oil surged sharply, gaining $1.82 to $104.82, a fresh 5 month high.

Many Russian oil pipes go through Ukraine and investors are concerned that this supply could be disrupted for a prolonged period.

On top of that, there's also speculation that oil supplies at Cushing are still slumping.

Turmoil in Eastern Europe undoubtedly fuelled renewed safe haven demand which sent gold prices soaring.

The precious metal rallied by $18.1 to $1,350.6, a level last seen during September 2013, and seems to have held its ground overnight as a political solution remains elusive.



Commodities Trading

: 03 March 2014

Slumping crude oil inventories at Cushing, Oklahoma kept WTI prices well supported.

At the same time, energy investors were enticed to remain long of crude by a sharp climb in the euro and stock markets hitting new records for 2014.

Overnight, the market is almost 1% higher as Ukraine remains on the brink of war with Russia.

Gold posted a loss of $7.8 to $1,323.7 on Friday as optimism regarding the pace of growth outweighed any concerns regarding events in Ukraine.

Nevertheless, the escalation in tensions turned the table last night, with gold prices already $12 higher.


By Jonathan Sudaria, 7 March 2014


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