Crude Oil and Gold Give Back Gains As Ukrainian Tensions Ease

New York (Mar 5)  Ukraine De-Escalation Dampens Gold Demand

Gold and silver have suffered as dissipating concerns surrounding a potential Ukrainian-Russian conflict have likely weakened safe-haven demand for the precious metals. This comes following reports from newswires that Russian President Vladimir Putin sees no immediate need to invade its Eastern European neighbour.

Putin’s comments also acted to calm the market’s fears over potential energy supply disruptions from Russia, which weighed on crude oil.

Oil Traders Look to Upcoming Inventories Data

The Department of Energy’s Weekly Petroleum Status Report is set to cross the wires in early US trading which is likely to offer further guidance for crude oil traders. WTI’s strength over recent weeks has coincided with 5 consecutive weekly declines in inventory levels at Cushing Oklahoma, which suggests increasing demand for the commodity. Another drawdown may prompt a bullish response from traders and send crude higher.

Risk-Trends to Offer Commodities Further Bearings

Broader risk-trends are likely to remain an important driver for the commodities space over the remainder of the week. If the Ukraine fuse is reignited, it is likely to drive renewed demand for gold and crude oil. On the data front, upcoming US ISM non-manufacturing figures may also prove noteworthy. With investor sentiment improving, an upside surprise may bolster demand for risk-sensitive commodities like copper.

Source: Finance-Yahoo