Oil Prices Fall, Gold Surges as Israel-Iran Conflict Enters Day Four

Global oil prices fell on Monday as concerns about a broader Middle East war began to ease, despite Israel and Iran continuing to exchange missile strikes for a fourth consecutive day. The retreat in oil prices came after an initial surge last week sparked by Israel’s surprise strikes on Iranian military and nuclear facilities, which killed several senior figures.

Brent crude dropped 0.4% to $73.95 per barrel, while West Texas Intermediate (WTI) declined 0.2% to $72.82 per barrel in early trading. The earlier spike had raised fears of global inflationary pressures and supply disruptions from the region.

Flight to Safety Boosts Gold Prices

Gold prices rose sharply as investors sought safety amid geopolitical uncertainty. The precious metal climbed to around $3,450 per ounce, edging closer to its all-time high of $3,500. Equities were mixed globally, as markets reacted to both geopolitical tensions and upcoming monetary policy announcements.

Central Banks, Tariff Talks in the Spotlight

Investors are closely watching the U.S. Federal Reserve and the Bank of Japan, both scheduled to hold key policy meetings this week. Despite political pressure from Donald Trump to cut rates and looming tariff threats, analysts expect the Fed to hold steady for now.

Chris Weston of Pepperstone said:

The Fed should remain constrained by uncertainties and is unlikely to offer anything truly market-moving.

 

Oil Supply Outlook Remains Steady

Despite heightened tensions, analysts say the risk of a broader war remains contained. OPEC plans to increase production, and while U.S. oil output growth has slowed, it could rebound if prices remain high.

“Fundamentals suggest that significantly higher prices are not warranted,” noted Allen Good, director at Morningstar, adding that the market remains well-supplied.

Global Markets Mixed

Tokyo’s Nikkei 225: +1.3%

Hong Kong’s Hang Seng: +0.7%

Shanghai Composite: +0.4%

FTSE 100 (London): +0.3%

Dow Jones (New York): –1.8%

Currency movements included a stronger euro and pound against the dollar, with the dollar also gaining slightly against the yen.

Corporate News: Nippon Steel Soars

In corporate developments, Nippon Steel shares rose over 3% after former President Trump signed an executive order approving its $14.9 billion merger with U.S. Steel, resolving long-standing regulatory hurdles.

Looking Ahead: G7 and Market Volatility

Leaders of the Group of Seven (G7) are meeting this week in the Canadian Rockies. The Israel-Iran conflict, global inflation concerns, and Trump’s tariff policies are expected to dominate discussions.

Meanwhile, markets remain volatile as investors weigh the economic implications of geopolitical tensions, trade uncertainties, and central bank responses.

Source: Vanguard Nigeria