Commodities Divergence: Gold Hits Record $4,900 as Oil Plunges

Global commodity markets are witnessing a sharp divergence. While Gold (XAU/USD) continues a relentless ascent to fresh record highs, Crude Oil prices have slumped as geopolitical risk premiums evaporate.

Gold's Unstoppable Rally

Despite a “risk-on” sentiment in equity markets—usually a headwind for safe havens—Gold has surged for the fourth consecutive day.

• Price Action: XAU/USD hit a record high of $4,906, currently trading up 1.60% at $4,903.
• Drivers: The move suggests a deeper systemic hedge is in play, possibly driven by concerns over sovereign debt sustainability (following the JGB scare) and lingering inflation stickiness in the US.

Oil Succumbs to Supply & Geopolitics

In stark contrast, WTI Crude Oil plummeted approximately 2%, touching a multi-month low near $59.33.

• Geopolitics Cooling: The withdrawal of US tariff threats against Europe and a softer stance on Iran have removed immediate supply disruption fears.
• Inventory Build: US crude inventories rose by roughly 3 million barrels (API data) and 1.1 million barrels (EIA data), reinforcing fears of a supply glut.

Technicals

• Oil is now trapped below its 200-day moving average ($62.24). Failure to hold the $58.50 support level could open the door to a deeper slide toward $55.00.

While the International Energy Agency (IEA) has upgraded medium-term demand forecasts, the immediate market pricing is dominated by the twin forces of high inventory and reduced geopolitical friction.