23.02.2016 - The price of oil was not able to continue to grow and will likely continue to fall
The price of gold shows growth after yesterday reached an important level of 1200 dollars per troy ounce. According to our forecasts, the quotes will continue to consolidate in the near future and in connection with the improvement in investor sentiment and the expected weakening of demand for defensive assets, and after the completion of consolidation we will see a strong downward movement. It should be noted that investment funds have increased gold reserves and offset their decline in the past year. Investors are waiting for the second preliminary US GDP growth report, which will be published on Friday. Our medium-term outlook for gold remains negative due to the expected growth of the dollar, the Fed raising interest rates and a weakening of demand for defensive assets.
The price of futures on Light Sweet crude oil yesterday showed strong growth on the background of the reduction in the number of active rigs in the US by 68% compared with a peak in 2014. Also yesterday, the International Energy Agency announced start of a reduction in US production of shale oil in March. According to forecasts of the organization, in 2016, oil production in the US will be reduced by 600 thousand barrels per day and 200 thousand barrels per day in 2017. Despite yesterday's rise, traders do not believe in changing the negative trend due to continued growth in oil supplies from Iran, which will compensate a possible reduction in US production and will surpass it. Our medium-term outlook remains negative.