Crude prices are rising after reports that the Empire State Building-length Ever Given container vessel blocking the Suez Canal will remain stuck until at least next Wednesday. Shipping rates have risen for a third consecutive day since the crucial east-west trading route that handles over 12% or world trade was only expected to take a couple days to get dislodged. Supply lines for crude are stretched thin so if this blockage lasts the greater Wednesday, oil prices should strengthen.
Egypt’s Suez Canal Authority reported that dredging operations at the bow of the ship are about 87% complete. The current dredging proximity is at 15 meters, with 10 meters eyed as the safest dredging proximity.
Oil has been punished this week as COVID cases spiked higher globally and over the slow rate of vaccination in Europe. WTI crude is down over 11% since the March high but should have massive support from the mid-$50s.
Crude prices extended gains after Goldman Sachs noted they expect a slower ramp-up in OPEC+ production.
Gold prices are looking vulnerable as Treasury yields continue to push higher. Gold’s two-week rally will end as investors struggle to assess the momentum in global economic recovery and the anticipation of inflation.
Rising COVID cases across the globe, including the US should provide some support to the argument that all the major central banks will remain ultra-accommodative in the short-term. The surge in Treasury yields is moderating and a steady climb higher should still be an environment that could have gold appreciate.
Bitcoin bulls are defending the $50,000 level as traders brace for the record $6 billion contract expiration Friday. Social media platforms (Twitter and TikTok) have focused on today’s expiry as a temporary hurdle for Bitcoin, but should do little to derail the long-term view for many hodlers (hold on for dear life).
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