Oil
Oil prices are falling as energy traders anticipate a brutal period of global growth. China factory activity remains depressed, and another eurozone record high inflation reading has raised the prospects of much more aggressive ECB tightening that could trigger a severe recession.
WTI crude pared losses after the EIA crude oil inventories report posted a hefty decline. The EIA report showed demand destruction as gasoline demand struggles and crude exports soften. US crude production rebounded and is back above the 12 million BPD level.
Crude prices have been trending lower as the oil market doesn’t look that tight anymore, but this last wave of weakness will likely be followed by a reduction in OPEC+ output.
Gold
Gold is struggling as inflationary pressures will keep all the major central bank's aggressive inflation tightening stance intact. Rising global bond yields is kryptonite for gold, and that trend might last a little while longer. Eventually, we will see global recessionary concerns cap tightening cycles, which should be what is needed for gold bulls to return.
Gold is still vulnerable to a break of the $1700 level, but long-term bets should return as investors scramble for safe havens.