Oil tumbles on Iran nuclear talks progress
Oil prices are extending losses for a third straight session, with the black gold losing more than 5% so far this week. Oil lost ground amid rumours of progress in Iran nuclear talks and as investors ditch riskier assets following the FOMC minutes.
The demand picture for oil remains mixed. On the one hand, demand in the West is expected to continue growing as the US, the UK and now Europe as it reopens. Meanwhile, demand in Asia is being hit by further restrictions to mobility as Covid cases continue to rise. India’s fuel demand is likely to fall further as additional restrictions to movement are imposed.
Crude inventories are helping to support prices after inventories increased by a less-than-expected 1.3 million barrels last week. Analysts had pencilled in a 1.6-million-barrel rise.
Technically, the picture for oil looks weak. WTI crude oil has fallen out of its multi-month ascending channel and has slipped through its 50 SMA on the daily chart at USD60.60, opening the door to a deeper sell-off.
Gold looks to jobless claims for further impetus
After some big swings in the previous session, gold managed to close the day marginally higher and is extending those gains on Thursday.
A huge sell-off in crypto-land on Wednesday boosted demand for the safe-haven metal, even as the minutes from the latest Fed meeting confirmed taper jitters. The minutes revealed that the central bank is ready to start discussing tapering in the coming meetings. This sent yields higher and lifted the US dollar.
Today, investors continue digesting the Fed minutes. US treasury yields are easing which combined with the weaker tone surrounding the US dollar are keeping Gold are supported as it eyes its four-month high. Ongoing volatility in the crypto space could keep the tone surrounding gold buoyant.
Looking ahead, US jobless claims could provide further impetus.
