Markets

Oil prices rise on tight supply, markets cautious about economic outlook

Oil price ET

Photo : iStock

KEY HIGHLIGHTS

  • Oil rises on market caution over supply woes
  • Oil claws back last week’s losses
  • Focus in oil market back on supply concerns

New Delhi: Oil prices clawed back last week’s losses on Tuesday as markets remained cautious about supply concerns.

Aggressive interest rate hikes by central banks across the world have flagged concerns of a possible slowdown with investors worried that massive central bank action could tip the economy off into recession.

With lingering questions over a fall in Russian output in the aftermath of Western sanctions, supply concerns are driving crude oil prices.

Meanwhile, countries across the world protested against “a global food crisis”, while the European union pointed to Russia and said European Union’s sixth round of sanctions that include an oil ban.

Gold steady as investors await further cues from central banks

Gold prices remained unchanged on Tuesday as investors awaited a direction after a historic week for global central banks with a record U.S. Federal Reserve bank interest rate hikes.

Federal Reserve Chair Jerome Powell is due to testify in Washington D.C. later this week.

Domestic equity markets extended gains for the second straight session, but the path ahead for the yellow metal remained unclear.

“June is a mixed month for gold (XAU/USD), from a seasonality perspective. Over the past 5-years, it has been the fifth worst month of the year for the precious metal, averaging a loss of -0.39%,” Christopher Vecchio, CFA, Senior Strategist said in a dailyfx.com report.

“Over the past 10-years, it has been the sixth best month of the year, averaging a gain of +0.28%,” Vecchio added.

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