04.04.2016 - We expect a further decline in oil prices
The price of gold continues to show a negative trend due to increased optimism on stock markets and reduced fears about the state of the global economy. Contradictory statistics on the US labor market, where the unemployment rate rose by 0.1% to 5.0%, while the number of new jobs outside the agricultural sector increased by 215 thousand against the forecast of 206 thousands, had not much impact on market expectations. According to our estimates, the interest in gold continues to fall against the background of stabilizing the situation and the expected tightening of the Fed's monetary policy this year. Our medium-term outlook remains negative with a target at 1100 dollars per troy ounce.
The price of Light Sweet crude oil futures continues to decline due to increased confidence in the absence of the effect of a meeting of representatives of several major oil producers in Qatar on 17 April. So, Iran and Libya will continue to increase production volumes on the highest possible pace. Saudi Arabia has said that it will freeze production levels only in the case of a similar move by Iran, but we exclude such a scenario. We see no reason to change the current negative trend and the likelihood of the continuation of the negative dynamics of prices with the potential reduction up to 34 and 31 dollars per barrel in the near future is high. Our medium-term outlook is also pessimistic.