Oil varies and gold falls with tension in the Gulf economy

Oil prices varied today, Friday, with Brent crude rising and West Texas Intermediate crude declining, while gold and precious metals fell, and the Japanese yen again tested the 160 level to the dollar, in light of the ambiguity of developments related to the US-Israeli war on Iran and the Gulf and Lebanon tensions.

Brent crude futures rose by 0.09% to $95.12 per barrel at the time of writing these lines, while US West Texas Intermediate crude futures fell by 0.24% to $92.82 per barrel, after a previous session that witnessed sharp declines for the two crude oils.

The oil movement came after reports of the suspension of oil loading at the Mina Al Fahal terminal in the Sultanate of Oman following an explosion that occurred near docks for mooring buoys, amid suspicion of a drone attack, coinciding with declining hopes for a soon end to the escalation in the region.

Reuters quoted IG market analyst Tony Sycamore as saying in a note that: “Optimism remains minimal in light of the tangle of conflicting news,” adding that from a technical standpoint, as long as West Texas Intermediate crude oil remains above the support level near $80, risks tend to rise.

Oil prices are heading towards achieving their first weekly gains in 3 weeks, with the continued faltering of peace talks between the United States and Iran, and limited traffic through the Strait of Hormuz, through which about a fifth of global oil supplies passed.

Metal pressures

Spot gold fell by 0.46% to $4,453.60 per ounce at the time of writing these lines, while US gold futures for August delivery fell by 0.77% to $4,470.37 per ounce.

She said that the yellow metal is headed for a weekly loss, after tension in the Middle East reduced hopes of reaching an agreement between the United States and Iran, amid rising inflation and fears of a tightening of the course of US interest rates.

ABC Refinery Director Nicholas Vrabel said that some pessimism regarding resolving the conflict with Iran had a negative impact on gold, adding that the prevailing trend in the markets tends to expect a tightening of interest rates, which also puts pressure on the precious metal.

San Francisco Federal Reserve Bank President Mary Daly said that the path of US interest rates will depend on economic developments, while Kansas City Federal Reserve President Jeffrey Schmid said that the option available to the US central bank now is to be patient and keep rates steady or raise them to reduce inflation.

As for other precious metals, their performance was as follows:

• Silver fell by 1.87% to $72.38 per ounce.
• Platinum fell 0.74% to $1,879.
• Palladium fell 0.39% to $1,291.
  The three metals are heading to record weekly losses.

Yen and dollar

In currency markets, the dollar recorded 159.93 yen at the time of writing these lines, after the yen tested the 160 level to the dollar for the third session in a row, a level that the markets widely view as a line that may prompt Japanese authorities to intervene.

Japanese Finance Minister Satsuki Katayama said that Tokyo is ready to respond appropriately at any time regarding the exchange market, and that it reserves the right to take “decisive measures” against excessive volatility.

The yen is heading to decline for the fourth week in a row, in the longest series of decline since February, erasing a large amount of the gains it achieved after an intervention that cost $73 billion last month, according to Reuters.

The euro stabilized at $1.1621, the British pound rose to $1.3434, while the risk-sensitive Australian dollar fell to $0.7126, and the New Zealand dollar stabilized at $0.5867.

The dollar index, which measures the performance of the US currency against a basket of currencies including the yen and the euro, fell by 0.06% to 99.325, but is still heading for weekly gains with safe haven flows linked to Gulf tensions.