Oil prices are continuing to stabilise around $90 a barrel as OPEC+ steps up its defence of its two million barrel per day cut amid a backlash from the US, in particular. Meanwhile, the world’s largest economy is reportedly considering another release of strategic reserves (SPR) in order to offset the impact of the cuts and stop fuel prices jumping as midterms near.
How effective the SPR release will be may well depend on whether others join as we saw earlier this year. Of course, at the time oil was trading at much higher levels, well above $100 a barrel, and the willingness to engage in joint action may well depend on whether countries perceive there to be a risk of similarly damaging prices when they’re already contending with a weaker economy, even recessions.
Gold rebound struggling
Gold has benefited from slightly lower yields and a weaker dollar over the last couple of days, both of which could resume their uptrend if rate fears persist. The yellow metal struggled to hold onto gains at the start of the week, perhaps a sign of the headwinds continuing to face it in this environment. Resistance remains above around $1,680 and $1,700, with support now around $1,640 and $1,620.