Following a positive session on financial markets yesterday, with equities showing strong gains after solid economic data out of China, the U.S. and Europe, markets have turned down again Thursday, though oil prices have held roughly flat. Gold prices have seen some gains today after dropping yesterday as a degree of wariness returns. Elsewhere in precious metals, platinum prices have risen to their highest level since November last year.
The balance between evidence of OPEC cuts biting into supplies and a rise in U.S. inventories on increasing production there is still holding, keeping oil prices within a tight range. This morning Brent crude gained $1.22 yesterday and as markets started trading in London this morning another 5 cents had been added taking it to $56.85. WTI moved 5 cents in the other direction, slipping to $53.83 after a gain of $1.07 yesterday. Weekly data from the U.S. Energy Information Administration yesterday showed a 6.5 million barrel increase in U.S. crude oil stocks, almost double the forecast for 3.3 million barrels. Gasoline stocks rose by an even greater multiple on forecasts, up 3.9 million barrels against a predicted 1 million.
Both Brent crude and WTI are currently comfortably within the $53 to $58 a barrel range expected to hold until clear evidence of global supplies balancing on OPEC and partners’ cuts, or failing to do so. That evidence is not expected to be apparent until the end of the first quarter to early second quarter. Yesterday’s gains edge oil prices towards the high end of the recent range and if prices were to rise by another $1 buyers would be expected to retreat without a clear catalyst.
Gold prices have moved up to one week highs this morning with the expected result of no immediate new interest rate rise by the Fed resulting from yesterday’s policy meeting providing some support. Spot gold prices in London as well as U.S. futures both gained well prior to markets opening this morning. Spot gold was up 0.6% to $1216 oz. and futures 0.8% to $1218.1 oz. Platinum’s 0.4% gain to $1000.35 oz., took it to its highest level since November 26th. Spot silver prices also added 0.5% to $17.50 oz.
Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.