What’s next? – GOLD, OIL 25.04.17

GOLD
Gold edged down in Asian hours on Tuesday, with market participants keeping an eye on the Korean peninsula for further developments in geopolitical tensions between the United States and North Korea and as risk-on sentiment continued to restore following the French election.
On the Comex division of the New York Mercantile Exchange, gold for June delivery was down 0.20 percent to trade at $1275.00 a troy ounce as of 06:20 GMT.
On Monday, bullion prices settled lower as traders started to move back into risky assets as pro-EU candidate Emmanuel Macron defeated far-right Marine Le Pen at the first round of the French presidential elections. A second round will take place on May 7.
The yellow metal was under pressure as recent polls indicated that Le Pen has barely no chances of becoming the next president. High officials from the EU have already expressed their support for the centrist candidate while saying that Le Pen was “dangerous” for the bloc.
However, losses were limited by a weaker US dollar in light of ongoing geopolitical tensions in the Middle East and the Korean peninsula. The US dollar index, which gauges the greenback against other six rivals, was trading around 99.2 earlier this morning, still below the 100.0 mark.
During the weekend, Kim Jong-un’s government said North Korea is ready to attack a US aircraft carrier and other Japanese vessels in the western pacific.
In other news, the US government announced on Monday that sanctions will be carried on against 271 employees of the Syrian Scientific Studies and Research Center, which according to the Trump administration is responsible for developing chemical weapons.

OIL
Oil prices extended gains in Asia trading on Tuesday as market players awaited a new weekly report on crude and refined products inventories in the United States.
US West Texas Intermediate oil futures traded at $49.35 a barrel on the New York Mercantile Exchange, up 0.24 percent from its prior settlement. The international Brent crude oil futures added 0.25 percent to trade at $51.73 a barrel as of 06:50 GMT.
The latest estimate from the American Petroleum Institute will be available this evening, with analysts expecting a decline of 1.3 million barrels for crude, a drop of 1.2 million barrels for heating oil and a 1.225 million barrels decrease in gasoline stockpiles.
Official figures will be released by the US Energy Information Administration on Wednesday. Last week, the agency reported a drawdown of 1.034 million barrels in crude inventories.
Crude benchmarks settled in red territory on Monday as market participants still feel doubtful about a possible extension of OPEC-led efforts and its effects on rebalancing global supply.
Last week, Russian Energy minister Alexander Novak said that “there are no decisions yet and each country is currently studying this issue independently,”
Russia is the leading non-OPEC member taking part on the output reduction agreement. All signing members agreed to reduce a total of 1.8 million barrels per day for the first six months of the year. The deal expires in June and the decision on the extension is due on May 25.

Fort Financial Services