Crude oil prices fell on Monday as improved supply prospects from OPEC+ member Kazakhstan outweighed market concerns that a blizzard sweeping across large parts of the United States could disrupt supplies. Against the backdrop of former President Trump reshaping international relations and investors fleeing sovereign bonds and currencies, silver prices recorded their largest surge since 2008, while gold prices broke through the $5,000 per ounce mark for the first time. London copper prices advanced.
Crude oil prices declined on Monday, as enhanced supply outlooks from Kazakhstan, an OPEC+ member, overshadowed worries that a massive winter storm affecting extensive U.S. regions might impact production.
WTI crude edged lower, settling below $61 per barrel. This followed a 2.9% increase on Friday, which marked the largest two-week gain.
The disruption to Kazakh crude exports, which had previously tightened European market supplies, eased as a key Black Sea terminal handling most of the country's oil exports resumed operations. Concurrently, the nation's massive Tengiz field is also scheduled to restart production shortly.
The additional supply alleviated fears of a shortage as investors assessed the impact of the winter storm affecting vast areas of the United States. Several facilities, including ExxonMobil's large Baytown refinery, scaled back operations ahead of the storm; meanwhile, diesel posted its largest gain since November due to rising heating demand. The full scale of supply shutdowns caused by the frigid weather remains uncertain.
Furthermore, tensions in the Middle East persist; the deployment of U.S. naval forces to the region by former President Trump fueled speculation that he might follow through on threats to attack the Iranian regime, intensifying concerns about the country's crude output.
March WTI crude on the New York market fell 0.7%, settling at $60.63 per barrel.
March Brent crude declined 0.4%, with a settlement price of $65.59 per barrel.
Amid former President Trump's reshaping of international relations and a flight by investors from sovereign bonds and currencies, silver prices soared by the largest margin since 2008, and gold prices surpassed the $5,000 per ounce milestone for the first time.
A weaker U.S. dollar bolstered demand, with gold prices climbing as much as 2.5% on Monday, exceeding $5,111.07 per ounce. Silver prices surged over 14% during the session, reaching a record high above $117 per ounce, also registering the largest intraday gain since 2008. Both precious metals pared some of their gains later in the U.S. trading day as the dollar trimmed its losses.
Gold's sharp ascent reaffirmed its traditional role as a market fear gauge. Having just recorded its best annual performance since 1979 last year, gold has climbed approximately 17% year-to-date. This is largely attributed to the so-called devaluation trade, where investors sell off currencies and U.S. Treasuries. Last week's significant sell-off in the Japanese government bond market serves as the latest example of investor pushback against massive fiscal spending.
As of 4:29 PM New York time, spot silver was up 1.1%, quoted at $104.35 per ounce.
Spot gold rose 0.66%, quoted at $5,020.51 per ounce.
At the close, LME copper futures advanced 0.64%, to $13,199.0 per metric ton.
LME aluminum futures increased 0.62%, to $3,188.5 per metric ton.
LME nickel futures declined 1.25%, to $18,522.0 per metric ton.
LME zinc futures rose 2.51%, to $3,342.5 per metric ton.
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