Oil headed for biggest weekly gain since July
Gold price firmer
LONDON, April 14, (RTRS): Oil prices steadied on Friday, heading for their largest weekly gain since July after US President Donald Trump’s comments about possible military action in Syria and reports of dwindling global oil stocks.
Recovering from earlier losses, Brent crude was up 28 cents at $72.30 a barrel by 1301 GMT and set for a weekly gain of almost 8 percent, or about $5.
US crude for May delivery rose 28 cents to $67.35, up more than 8 percent, or about $5, for the week.
“You have to put today’s moves in the context of the last three days. There hasn’t been any particular change today in terms of geopolitics or fundamental data,” said Harry Tchilinguirian of BNP Paribas.
Both oil benchmarks hit their highest since late 2014 on Wednesday after Trump warned that missiles “will be coming” in response to a suspected gas attack in Syria and after Saudi Arabia said it intercepted missiles over Riyadh.
Trump tweeted on Thursday that an attack on Syria “could be very soon or not so soon at all”, raising the prospect that an attack might not be as imminent as he seemed to suggest the previous day.
Risks
“As we start the last day of the week, we feel that the geopolitical risks are not as high as feared three days ago,” Petromatrix said in a note.
“The Syrian escalation risk cannot be fully written off, but we view that it deserves less of a premium than three days ago.”
A global oil stocks surplus is close to evaporating, OPEC said on Thursday, adding that its collective output fell to 31.96 million barrels per day (bpd) in March, down 201,000 bpd from February.
Vienna-based OPEC and its oil producer allies are poised to extend their supply reduction pact into 2019 even as the global glut of crude looks set to be eradicated by September, OPEC Secretary-General Mohammad Barkindo told Reuters.
The International Energy Agency (IEA), which coordinates the energy policies of industrialised nations, signalled on Friday that markets could become too tight if supply remains restrained.
“It is not for us to declare on behalf of the Vienna agreement countries that it is ‘mission accomplished’, but if our outlook is accurate, it certainly looks very much like it,” the IEA said.
Meanwhile China’s March crude oil imports climbed month on month to the second-highest level on record.
In Norway, Eni has shut output at its Arctic Goliat oilfield because of a small at a platform that has capacity of close to 100,000 barrels a day.
Gold prices rose on Friday, heading for a second weekly gain on lingering uncertainty over Western military action in Syria.
US President Donald Trump and his national security aides on Thursday discussed options on Syria, where he has threatened missile strikes in response to a suspected poison gas attack, as a Russian envoy voiced fears of wider conflict between Washington and Moscow.
Trump, however, cast doubt over the timing of his threatened strike, tweeting that a US attack “could be very soon or not so soon at all”.
Gold is often used as a store of value in times of political and financial uncertainty.
Attack
“Donald Trump back-pedalled a bit in his morning tweet yesterday, but the danger is still there that the situation could escalate with Russia due to a military attack on Syria,” Quantitative Commodity Research consultant Peter Fertig said.
“We are back at a Cold War, which easily could turn into a hot war if someone loses their nerve — and in such a situation, gold is a haven.”
Spot gold was up 0.7 percent at $1,344.16 an ounce at 1425 GMT, set for a weekly gain of nearly 1 percent. US gold futures rose 0.4 percent to $1,347.50.
In technicals, first support for gold comes in at $1,315, near the 100-day moving average. A break of this could see gold test the 200-day moving average around $1,300.
Global equities were poised for their biggest weekly gain in more than a month as investors shrugged off the geopolitical tensions.
Easing concerns over the trade war between China and the United States also weighed on gold in the previous session. Meanwhile, holdings of SPDR Gold Trust , the world’s largest gold-backed exchange-traded fund, rose 0.69 percent to 865.89 tonnes on Thursday.
Holdings rose to their highest since June 2017 and were up about 3.5 percent so far this year.
Silver rose 1.2 percent to $16.62 an ounce, up nearly 2 percent this week. Platinum was up 0.2 percent at $926.50. For the week, the metal was on course for a more than 1 percent gain, the biggest rise in about two months.
Palladium climbed 2 percent to $982.47 and was set for a more than 8 percent weekly gain, its biggest since January 2017.
The metal, more than 40 percent of which is produced in Russia, has bounced strongly this week as sanctions against Moscow fed into a technically driven rebound after the first quarter’s 10 percent slide.