Saudi ultimatum lifts crude

Chris Beauchamp IG

Heading into the close, the FTSE 100 is eight points lower, but a rebound in oil is helping to put a positive spin on the day.

Saudi/Qatar spat moves to a new level
Stocks still becalmed
Gold on the up as week draws to a close

A resurgence in oil prices, which are doing their best to finish a tough week on a high, has helped restore some confidence as Friday’s session winds down in London. Some of the bounce in crude is likely down to worries that tensions in the Gulf are about to rise once more, as Saudi Arabia and co issue a set of demands to Qatar. The list of requirements is so comprehensive as to reduce Doha to a virtual satellite of Saudi Arabia, bringing the state back in line with its near neighbours. If the demands push Qatar further into Iran’s arms, Riyadh may find itself with an ever-growing problem. Stocks have managed to lift themselves off the lows, but the overall tone of the week has been mildly
negative. With little on the agenda for the next few days too, it looks like the summer malaise has further to run.

Gold still looks to be the one to watch next week, helped on its way by a weaker US dollar and rising geopolitical tensions. Should we see fresh news from the Gulf next week, then the highs of early June could be rapidly recovered.

Author

Chris Beauchamp

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