The oil prices felt for more than 3%. That becomes the worst decline in a month. It is especially after the main pipes for the United States fuel were opened again after the cyber attack.
Furthermore, the worse covid situation in India also adds the pressure for that commodity. The price is becoming lower since India is the third largest consumer in the world. The impact is real.
The West Texas Intermediate which was sold in New York becomes the Benchmark for the raw oil in the America. It felt by 3.34% or for about $2.36 in the position of $63.82 per barrel.
The Same Trend For Brent
The declining WTI was the sharpest decrease in a day since 5 of April, especially when it decreased by 4.5%. Elsewhere, BRENT also has the same trend like the WTI. That commodity was sold in London.
For your information, it becomes the global benchmark for the raw oil. At the end of the session, it felt down by $2.27 or around 3.3%. It is in the $67.05 position right now.
The sharpest decline of BRENT was before happened in 5 of April when that commodity felt down by 4.2 percent. Now, people are questioning why that condition can occur in the market.
Actually, the main cause is the collonial pipelines which are re-opened after it was closed for six days to withstand the system attract. That attack was on the largest delivery system in the US east beach.
How About The Seasonal Increase Momentum?
The declining prices of oil and its raw materials create a question about the seasonal increase momentum. It is especially for the energy market towards the end of the week of a Memorial Day in America.
That event is in the 31.of May this year. Traditionally, it is used as the early weapon to the dry season races due to the prices of oil. Usually, the demand is rocketing from the Americans who will do a long trip.
Vice versa, another commodity such as gold continues its good trend and increase. It happened in the early Asian sales session lately. The gold buyers take the advantage from USD weakening.
Furthermore, it supports the risk-on situation overworked on Fridays. The index of Dollar jumps by 10 pips before it declined to $90.39 lately. Hoe about the greenback index so far?
The Soft Policy By The Fed
The index of greenback supported the lack of data, main events, and geopolitical riot at first. However, there is a worry about the united States reflection and the soft policies made by The Fed.
It seems that those factors can push the gold prices. Next, a data from China can be the key because of the strong numbers from the largest industry player in the world. That may renew the concern about inflation.
The gold bullish can maintain its control for more than $1.850. It is because the sellers extend their risk sentiment on Friday and it was continued to the early Monday session in Asia.
The Inflation Concern is Appearing
When the economy situation in the west countries area are fully recovered, the concern about inflation will become a focus again. There is a strong reason for this kind of situation. Why?
It is because the Central bank and governments in all over the world have been pumping the system with money during the pandemic. The Fed has a more challenging duty to maintain the soft policies.
It is after the Bank of Canada and Bank of England change their obligation purchase. They also renew the tapering discussion. The negative side can also become a further stimulus from the Biden’s table.
