Concerns Around Russia Halting Gas Flows To Europe Are Growing, Rebounding Cotton Prices, Gold Prices Threatened By Ongoing Economic Uncertainty
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Summary:
- NGAS prices are rising amidst supply concerns.
- Risk of gold experiencing further declines.
- India’s monsoon season and cotton prices.
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Natural Gas Prices Rise
NGAS futures have risen to levels that have not been seen in more than a month, amidst a demand that has been driven by weather, whilst simultaneously the uncertainty around supply of gas in the Eurozone kept demand for US LNG exports supported. In Europe, fears have been growing around the possibility that Russia will cut gas flows to the continent and jeopardize the EU’s goal to fill 80% of their storage capacity by the next winter season.
Reuters has recently reported that Russia's Gazprom has informed its European customers that it cannot guarantee gas supplies due to 'extraordinary' circumstances, a move that Europe describes as retaliation for sanctions imposed on Moscow for invading Ukraine.
NGAS Aug ‘22 Futures Price Chart
Gold Futures Close To one year lows
Gold prices have been remaining close to its lowest levels in almost a year and have been facing constant downward pressure from aggressive US monetary policy tightening and a stronger US Dollar which became increasingly more attractive than the non-yielding metal in serving as a hedge against ongoing economic uncertainty. Gold futures also struggled to hold their intraday gains on Monday despite the dollar’s retreat, which was considered as a technical weakness by analysts and in fact could increase the risk of gold experiencing further declines.
Gold Aug ‘22 Futures Price Chart
Cotton prices rebounded
Cotton prices have rebounded since touching nine-month lows on July 14th as speculators in the commodity market took advantage of the lower prices and the monsoon season in India, the top producer. At the same time investors continue to digest the USDA’s July supply and demand report.
Cotton Oct ‘22 Futures Price Chart
Sources: finance.yahoo.com, tradingeconomics.com
