CRUDE OIL & GOLD TALKING POINTS:
- Crude oil prices[1] fall as Trump woos Iran, Russia boosts output
- Deeper losses likely if EIA inventory data echoes API estimate
- Gold prices[2] may lead commodities lower on hawkish Fed tone
Crude oil prices fell as easing OPEC+ output caps allowed Russia to increase output to 11.22 million barrels per day and US President Trump said he is prepared to meet with Iranian leader Hassan Rouhani “without preconditions”. That stoked hopes for an accord that might lead to the easing of recently re-imposed sanctions following a US exit from an Obama-era denuclearization deal.
API inventory flow data compounded downside pressure. The report showed stockpiles added a hefty 5.59 million barrels last week. The outcome stands in stark contrast to forecasts calling for a 2.26 million barrel outflow to be reported in official EIA figures due Wednesday. Prices may suffer deeper losses if that result hews closer to the API projection.
See our guide to learn about the long-term forces driving crude oil prices[3]!
HAWKISH FED MAY BROADLY WEIGH ON COMMODITY PRICES
A stronger US Dollar[4] in the wake of the upcoming Fed monetary policy announcement may compound the down move, applying pressure across the spectrum of commodities denominated in terms of the benchmark currency. It may be gold prices that suffer particularly steep losses in such a scenario however if officials dial up hawkish rhetoric[5], acting directly against the metal’s appeal as an anti-fiat alternative.
Learn what other traders’ gold buy/sell decisions[6] say about the price trend!
