US-Iran dispute: Oil and gold prices rise globally
- January 06, 2020
- Andrew S Gillis
Oil and gold prices rose to the highest level in six years following the Middle East crisis that led to the assassination of an Iranian military commander in the US.
The tensions between Iran and the United States have become tense with each passing day after the Iranian commander’s death, and threats from each other over the world have resulted in global oil and gold. Prices have increased significantly.
Iran on Sunday announced not to abide by the nuclear deal, and after the attack, the Iraqi parliament demanded the withdrawal of foreign troops from its country.
The crisis has shaken investors, where investors were excited about a small-scale trade deal between China and the United States next week, given signs of improvement in the global economy.
Asian trade markets saw crude oil prices rise by 2%, while Brent’s price surpassed $ 70 for the first time since September, where oil production even after Saudi Arabia’s attacks on oil installations last year. As a result, Brent’s price rise was recorded.
The US is facing severe criticism from the international powers, especially China and Russia, for targeting the Iranian general, but US President Donald Trump is in an aggressive mood, and he sees Iran as a threat to any action. Claimed to have targeted dozens of key locations and said they did not need the approval of the US Congress for any kind of action.
Faye Wray Atrell, who holds the key position at the National Australian Bank, said global political tensions are likely to rise in the coming days, which will increase oil prices.
On the other hand, ‘gold’, which is considered to be the safest asset in a crisis but is also seeing a rise in prices where gold prices have not reached the highest level since 2013 and the current situation of the dollar. In comparison, Japanese yen prices have reached the highest level in three months.
Trader Stephen Innes said no one wanted the start of the new year with such a bad situation and investors were expecting favourable conditions following the announcement of a trade agreement between China and the United States, but the current stock market is shaky.
Wall Street also saw a downward trend in equity markets, where the three index records fell below the high, while a decline in all seven stock exchanges of the Gulf Cooperation Council was also seen in the wake of a possible Iranian invasion of US forces or installations.
There are US bases in Arab countries such as Kuwait, Bahrain and Qatar, while Saudi Arabia also has hundreds of US bases.
The effects of falling equity markets also reached Asia, where the downward trend was seen in the Tokyo and Singapore markets, but the Shanghai market remained stable.