Markets surge as oil bursts higher

- Central banks add fuel to the flame

- Oil prices raise miners, yet could also raise inflation expectations

- Geopolitical tensions and falling crude output sees oil spike higher

- Glencore’s zinc cuts see commodities rise across the board

A mix of ECB easing, a frightened Fed and a bearish BoE helped this recent rally tick along nicely, as indices seek to close out what looks like the biggest weekly gain of 2015 so far. The spike in oil prices clearly has been having a positive effect, with mining stocks rising once more to send the FTSE towards a third consecutive day in the green. Worries over market instability (read exchange rate strength and market decline), disinflation and Chinese instability continue to dominate fears in the Western world and are likely to for the foreseeable future.

The problem with yesterday's FOMC minutes was that their relevance was somewhat tainted by the recent weak US jobs report, which would no doubt guide perception towards an even more dovish view in the committee. For now the relationship between oil prices and indices is certainly a positive one given the impact it is having upon sector-specific firms. However, higher crude prices will no doubt soon raise inflation expectations, which coupled with strong wage growth could nudge central bankers to allay fears over disinflation.

That being said, this is dependent upon oil prices continuing to exploit the current gains we have seen, which seems likely for now, given increasing Russian involvement in Iraq/Syria. Rising Middle East geopolitical tensions, coupled with gradual easing in US shale output are two sure-fire reasons for bulls to regain the upper hand, for now.

The rise in commodity prices has been felt increasingly across the board, led by zinc's circa 10% rise thanks to Glencore's decision cut production by a third, in turn slashing jobs. Zinc gains have had a profound effect upon the rest of the base metals, which have secured healthy gains for the day. One side of the commodity story has been abundantly clear, with demand falling sharply as Chinese economic activity slows. Yet today's announcement begins to bring the supply side into stark relief and could provide further interest in beleaguered commodity prices.