Gold reversed its earlier losses on Tuesday morning in London, climbing back above $1,200 after the world’s two largest crude producers, Saudi Arabia and Russia, agreed to freeze oil output at January levels after talks in Qatar today.
– Qatar and Venezuela also agreed to freeze production. Oil prices initially surged by six percent this morning, with Brent climbing above $35 per barrel, although they have since retreated to $34.
– “The disappointing oil outcome – a freeze rather than any cut – is prompting some buying in gold again,” FastMarkets head of research William Adams said.
– The spot gold price was last at $1,212.10/1,212.40 per ounce, up $4.30 on Monday’s close. Trade has ranged from $1,191 to $1,213.10 so far.
– The US will return to the market today after yesterday’s one-day holiday. “With the US returning to work for the week today, we remain slightly cautious, especially considering that last time they saw the gold we were trading at $1,238 and there may be further longs to clear,” MKS noted.
– In the other precious metals, silver was little changed at $15.33/15.35 per ounce. Platinum rose $4 to $934/939 while palladium was unchanged at $507/512.
(Editing by Mark Shaw)