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Oil prices held firm on Friday, after rising more than $3/bbl in the wake of reports that Israel had attacked Iran, while gold prices headed for their biggest streak of weekly gains in a year, supported by a softer dollar and safe-haven buying.
The benchmark contracts surged more than $3 before dipping back down. Brent futures were up +0.36% to $87.42 a barrel by 5:41 am ET. The most active U.S. West Texas Intermediate contract advanced to +0.51% to $83.15.
“The fear is that we are on an escalating tit-for-tat retaliatory path… The hope is that the retaliatory strikes will be fading in magnitude and then fizzle out,” Bjarne Schieldrop, commodities analyst at SEB Research told Reuters.
Crude’s risk premium received a fresh boost on MidEast tensions, Ole Hansen, Head of Commodity Strategy at Saxo Bank said.
Iran, the third-largest producer in the Organization of the Petroleum Exporting Countries, produces about 3 million barrels of oil per day (bpd), or around 3% of total world output.
Meanwhile, spot gold prices also extended gains, set for their five-consecutive week of gains, and up over 2% so far this week. Prices (XAUUSD:CUR) hit an all-time high of $2,431.29 on Friday.
Bullion briefly broke $2,400 an ounce on the Israel attack reports before pairing back gains. A weaker dollar (DXY) makes gold less expensive for buyers in other currencies, while the metal also tends to benefit in times of economic and geopolitical uncertainties.
The gains in gold however came despite strong U.S. data, hawkish comments from Fed members and a stronger dollar, Saxo’s Hansen added.
A broad risk-off tone across markets also added to gold’s safe-haven status.
Recent Commodity Price Movements and A look At Some ETFs
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Commodity ETFs
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