Silver Price Forecast: XAG/USD jumps above $76.50 as Venezuela tensions boost safe-haven demand
- Silver price gains ground to around $76.55 in Tuesday’s Asian session.
- US strikes in Venezuela revive demand for safe-haven assets such as Silver.
- Traders will closely monitor the US December jobs report on Friday for fresh impetus.
Silver price (XAG/USD) trades in positive territory near $76.55 during the Asian trading hours on Tuesday. The white metal extends its upside on safe-haven flows following the United States' (US) capture of Venezuelan President Nicolas Maduro.
US President Donald Trump’s ousting of Maduro added a new element of geopolitical risk to markets. Trump stated that Washington might make a second military attack if Venezuela’s interim president, Delcy Rodríguez, did not accommodate their demands, per the Guardian. Maduro on Monday pleaded not guilty to US charges in a narco-terrorism case against him, kicking off an extraordinary legal battle with major geopolitical ramifications.
“The situation around Venezuela has clearly reactivated safe-haven demand,” said Alexander Zumpfe, a precious metals trader at Heraeus Metals Germany.
Expectations for US interest rate cuts later this year might also lift the Silver price. Financial markets are currently pricing in two quarter-point reductions from the US Federal Reserve (Fed) in 2026. Lower interest rates could reduce the opportunity cost of holding Silver, supporting the non-yielding precious metal.
Traders will keep an eye on the US December jobs data on Friday, as it could influence Fed policy. The US Nonfarm Payrolls (NFP) are projected to increase by 55,000 in December, while the Unemployment Rate is estimated to decline to 4.5% in December from 4.6% in November. However, if the reports show a stronger-than-expected outcome, this could strengthen the US Dollar (USD) and cap the upside for the USD-denominated commodity price in the near term.
WTI Oil FAQs
WTI Oil is a type of Crude Oil sold on international markets. The WTI stands for West Texas Intermediate, one of three major types including Brent and Dubai Crude. WTI is also referred to as “light” and “sweet” because of its relatively low gravity and sulfur content respectively. It is considered a high quality Oil that is easily refined. It is sourced in the United States and distributed via the Cushing hub, which is considered “The Pipeline Crossroads of the World”. It is a benchmark for the Oil market and WTI price is frequently quoted in the media.
Like all assets, supply and demand are the key drivers of WTI Oil price. As such, global growth can be a driver of increased demand and vice versa for weak global growth. Political instability, wars, and sanctions can disrupt supply and impact prices. The decisions of OPEC, a group of major Oil-producing countries, is another key driver of price. The value of the US Dollar influences the price of WTI Crude Oil, since Oil is predominantly traded in US Dollars, thus a weaker US Dollar can make Oil more affordable and vice versa.
The weekly Oil inventory reports published by the American Petroleum Institute (API) and the Energy Information Agency (EIA) impact the price of WTI Oil. Changes in inventories reflect fluctuating supply and demand. If the data shows a drop in inventories it can indicate increased demand, pushing up Oil price. Higher inventories can reflect increased supply, pushing down prices. API’s report is published every Tuesday and EIA’s the day after. Their results are usually similar, falling within 1% of each other 75% of the time. The EIA data is considered more reliable, since it is a government agency.
OPEC (Organization of the Petroleum Exporting Countries) is a group of 12 Oil-producing nations who collectively decide production quotas for member countries at twice-yearly meetings. Their decisions often impact WTI Oil prices. When OPEC decides to lower quotas, it can tighten supply, pushing up Oil prices. When OPEC increases production, it has the opposite effect. OPEC+ refers to an expanded group that includes ten extra non-OPEC members, the most notable of which is Russia.
Author
Lallalit Srijandorn
FXStreet
Lallalit Srijandorn is a Parisian at heart. She has lived in France since 2019 and now becomes a digital entrepreneur based in Paris and Bangkok.
