Demand for gold remained relatively unaffected. According to the World Gold Council, the positive dynamics of demand was recorded among segments of jewellery, investment bars and coins. Demand for Central Bank securities also increased.
According to forecasts, most of Europe will experience relatively warm weather during the holidays. Thus, the risk of heavy snowfalls at Christmas will be lowered, and the European power grid’s stress will be mitigated.
Oil steadied after a three-day rally. Market watchers’ fears that short-term Chinese demand may decline amid a COVID-19 surge offset support from a draw in US oil inventories and a less strong dollar.
In a few days, Germany will stop importing oil from Russia. This creates pressure to look for alternatives. One option is to use Russia’s pipeline system to import oil from Kazakhstan.
The abrupt cancellation of the Covid Zero policy has caused a wave of disease across the country. Consequently, traffic in China's largest cities fell to its lowest level since the beginning of the year.
The White House’s top energy advisor Amos Hochstein criticized shale drillers for their refusal to increase oil production. As it was stated by CEO of Pioneer Natural Resources Scott Sheffield, U.S. shale producers aren’t going to drill more.
According to the weather forecast, Texas will experience this year’s coldest temperatures by the end of the week. At the same time, the change of weather is unlikely to impact oil and gas production and transportation.
On the one hand, oil prices remained in the range of minimum annual values, as the fear of possible recession is still strong and trading ahead of the holidays is less active. On the other hand, there is a suggestion that the price increase projected for next year has already begun.
Energy demand in Asia was seen rising in recent weeks, which was partially triggered by the return of China to the liquefied natural gas (LNG) spot market. Easing of COVID-19 quarantine protocols in China may be the reason why the Atlantic and Pacific basins will have to compete for LNG next year.
Inflation in the United States, which turned out to be lower than expected, is putting pressure on the U.S. currency. According to economists at ANZ Bank, along with falling real yields, this has helped gold prices to reach the value of $1,800 an ounce again.
