Oil market is likely to remain oversupplied for the time being
In view of the de-escalation of the Middle East conflict and the now complete withdrawal of voluntary OPEC+ production cuts of almost 2.5 million barrels per day, the oil price has fallen significantly since the end of July and has since stabilised below the USD70 per barrel mark. This means that North Sea Brent crude is trading at around 20% lower in euro terms than at the beginning of the year. Although OPEC+ production is expected to stabilise from this point onwards, the oil market is likely to remain oversupplied for the time being due to the expansionary course of non-OPEC countries and overall subdued demand. However, a likely decline in US shale oil production, low inventories outside China and possible US sanctions against India for purchasing Russian oil are preventing a sharp drop in prices.
Oil market has been in supply surplus for nine months
Brent oil price per barrel (in USD) and global supply and demand structure (in million barrels per day)
The environment for gold could hardly be better at present
After gold gained significantly in value at the beginning of the year, the precious metal remained within a narrow trading range for a long time since the end of April. In addition to declining demand due to the increased price level, the increased risk appetite of many investors, who preferred alternative asset classes, also limited further price increases. However, anticipation of the Fed's recent interest rate cut, concerns about the central bank's dwindling independence under Trump and a sharp rise in ETF holdings have recently given the precious metal a new boost. Structural demand from central banks, ongoing geopolitical tensions and rising government debt are likely to continue to support the gold price in the medium term, alongside a further weakening of the dollar, increasing inflation risks and cautious positioning.
Gold ETF holdings have risen notably since the start of the year
Gold price development (in USD) and gold ETF holdings (in billion ounces)
Metals caught between conflicting market forces
Industrial metals have recently failed to find a clear direction after Trump's tariff policy led to some significant movements: after the copper price rose sharply due to tariff concerns, copper traded on COMEX suddenly lost value at the end of July following the announcement of an import tariff on semi-finished copper products. Looking ahead, demand is likely to flatten out initially due to advance purchases and high inventories. Despite small steps by China to support demand, a dollar that is likely to continue to weaken and structural demand (electrification, rearmament), industrial metals are likely to trend sideways for the time being without a significant economic upturn.
COMEX inventories at their highest level since 2003
Copper stocks traded on COMEX and LME
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