Want to know where gold prices are heading next? Then keep an eye on oil [Video]

The Oil market is enjoying some of its best years ever and that trend could be here to stay with the prospect of prices remaining above $100-plus a barrel for the foreseeable future.

If you want to know where Gold prices are heading next, then just take a look at the bullish trend in Oil prices.

Oil prices started the week on a tear, surging to their highest level since March – in anticipation of higher demand as China – the world’s largest importer of crude began easing coronavirus-related restrictions.

Shanghai, China's largest city with 26 million people, which has been under lockdown for more than six weeks – announced plans to start reopening on Monday and gradually return to more normal life from June 1.

Expectations are now running high, that the Oil market may see an identical V-shape recovery in demand as seen in 2020 when China ended lockdown. That event triggered an historic bull run taking Oil prices from sub $40 a barrel in April 2020 to a decade high of almost $140 a barrel in April 2022. That's a whopping gain of more than 450%, in the last two years.

The timing of Shanghai's reopening comes at a pivotal moment when global Oil inventories are at the lowest since 1987, OPEC+ and U.S shale producers continue to restrain output increases due to rising drilling costs and sanctions threaten to disrupt Russia’s Oil production and exports.

Historically, surging Oil prices usually feed into inflation expectations and boost demand for assets with inflation-hedging capabilities, such as the Precious Metals.

According to a long list of leading Wall Street banks – Oil prices could very easily be trading back above $130 a barrel by summer and then surge towards $150. Once that happens, Gold prices won’t be too far behind.

Where are prices heading next? Watch The Commodity Report now, for my latest price forecasts and predictions: