(Investing.com) U.S stimulus deal talk is a catalyst that could push Gold back to $2,000 per ounce zone. Also, it will help to steady oil prices to around $40-per-barrel region. The resumption of COVID-19 relief talks on Friday pushed gold to a positive close for a second straight day and also bolstered its gain in as many weeks.
“Gold prices skyrocketed … after the White House blinked first over the stimulus deadlock,” said Ed Moya, analyst at New York’s OANDA. “Gold looks like it will benefit from a stimulus deal before the election. It is unclear if Democrats will accept the latest … offer, but it seems the White House is determined to get something done.”
The restart of the Mnuchin-Pelosi talks also figured in oil’s return to the green lane after two weeks in the red, though the bigger catalysts were supply disruptions from the evolving Hurricane Delta and a brief Norwegian oil strike.
Despite a near 10% gain on the week, the outlook for crude remains suspect in the near term given the typically slower demand period in the fall season, and the escalation of coronavirus infections in several U.S. states as well as in Europe, analysts said.
Also, with the Norwegian Oil and Gas Association and industry union Lederne reaching an agreement Friday to end the oil strike in the Scandinavian state, market bulls may need to find a bigger price mover in the week ahead.
Precious Metals Review
U.S. gold for December delivery last traded at $1,936.40, after officially settling Friday’s session at $1,926.20 an ounce on New York’s Comex — up $31.10, or 1.6%, on the day. For the week, it rose about 1%.
Spot gold, which reflects real-time trades in bullion, last traded at $1,930.23 — up $36.37, or 1.9%. For the week, it rose 1.6%.
Energy Weekly Review
New York-traded West Texas Intermediate, the key indicator for U.S. crude prices, last traded at $40.55, after officially settling Friday’s trade at $40.60 per barrel — down 59 cents, or 1.4%, on the day. For the week, WTI rose $3.55 or 9.6%.
London-traded Brent crude, the global benchmark for oil, last traded at $42.80, after finishing the session at $42.85 — down 49 cents, or 1.1%, at $42.85. For the week, Brent was up 9.1%.
Nigerian Bonny Light closed at $41.88 per barrel. It rose by $0.30 or 0.72% on Friday.
Oil closed off Friday’s lows after government data showed that nearly 92% of oil production and almost 62% of gas output in the U.S. Gulf Coast of Mexico have been shut as a precaution ahead of Hurricane Delta.
Energy Calendar Ahead
Monday, Oct 12 – Private Cushing stockpile estimates
Wednesday, Oct 14 – American Petroleum Institute weekly report on oil stockpiles.
Thursday, Oct 15
- EIA weekly report on crude stockpiles
- EIA weekly report on gasoline stockpiles
- EIA weekly report on distillates inventories
- EIA weekly report on natural gas storage
Friday, Oct 16 – Baker Hughes weekly survey on U.S. oil rigs