03.10.2016 - The price of oil can’t continue the increase

The price of gold continues to gradually decline against the backdrop of rising stock markets and a decline in demand for protective assets. Support for gold prices in the near future may be an increase in speculation about a possible victory of Donald Trump in the US presidential election in November. This scenario scares investors for its unpredictable consequences and may lead to increased demand for defensive assets. The focus this week will be on publication of the report on the labor market in the US on Friday, and today we recommend paying attention to the data on the manufacturing PMI and construction spending in the US (14:00 GMT). Our medium-term outlook remains positive with potential objectives 1400-1430 dollars per troy ounce.

The price of Light Sweet crude oil continues to consolidate due to lack of drivers for further growth. The recent reaching of a preliminary agreement between the countries of OPEC on reducing the production volume in the region with the expected level of 33.60 million barrels in September, to 32,50-33,00 barrels per day. We are skeptical about the possibility of reaching a final consensus on the reduction of production volumes. Increase of drilling activity in the US, will continue to put pressure on the oil quotations. We continue to monitor the demand for oil in Asia, which can support the bulls. Our forecast for the coming months remains negative, and growth potential in the near future is limited.

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