16.06.2014 - Military action in Iraq has led to a rise in oil prices
Gold prices continued to rise amid escalating conflict in Iraq, where militants seized the second largest city in the country - Mosul and rising tensions in relations between Russia and Ukraine after the damage of the Russian embassy in Kiev by demonstrators. Today, the dynamics of trading may be influenced by the consumer price inflation in the Eurozone (09:00 GMT) and industrial production in the U.S. (13:15 GMT). It should be noted that the macro statistics will be on the second scene, and investors will be more follow the geopolitical news. We expect continued growth in gold prices in the medium and long term.
Oil prices soared after gunmen seized large areas in western and northern Iraq. At the same time it is worth noting that these events do not have a major impact on oil supplies from the country, since northern Iraq oil has not been exporting oil for a few months because of the terrorist attacks on oil pipelines, and southern parts of the country are under the control of the government. Another stimulus for the rise in oil prices may be the suspension of Russian gas supplies to Ukraine and stop of gas transit through its territory. We expect that in the medium term, oil prices will stay at high levels and will continue to grow.