Gold climbs as attacks on Saudi oil plants lift safe-haven bets

Gold climbed more than 1 percent on Monday as investors scurried for safe-haven assets after weekend attacks on Saudi Arabia’s oil facilities risked disrupting global energy supplies and increasing tensions in the Middle East.

Spot gold was 1.2 percent higher at $1,506.87 per ounce, as of 0050 GMT, on track to mark its biggest one-day percentage gain since August 23.

U.S. gold futures gained 1.1 percent to $1,516.10.

Yemen’s Iran-aligned Houthi group said it attacked two plants at the heart of Saudi Arabia’s oil industry on Saturday, knocking out more than half the Kingdom’s output.

U.S. President Donald Trump said on Sunday the United States was locked and loaded for a potential response to the attack on Saudi Arabia’s oil facilities, after a senior official in his administration said Iran was to blame.

Oil prices surged to six-month highs on Monday, while Wall Street futures turned lower and safe-haven bets returned after weekend attacks on Saudi’s crude facilities knocked out more than 5 percent of global oil supply.

The U.S. Federal Open Market Committee meets on Tuesday and Wednesday, with a press conference by Chair Jerome Powell scheduled to follow the release of the central bank’s statement.

China will exempt some agricultural products from additional tariffs on U.S. goods, including pork and soybeans, China’s official Xinhua News Agency said Friday, in the latest sign of easing Sino-U.S. tensions before a new round of talks.

Chinese Premier Li Keqiang said it would be very difficult for China’s economy to grow at a rate of 6 percent or more because of the high base from which it was starting and the complicated international backdrop.

The British Chambers of Commerce cut its forecast for economic growth this year and 2020 on Monday, blaming a slower global economy, U.S.-China trade tensions and the persistent drag from Brexit.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.67 percent to 874.51 tonnes on Friday.

Hedge funds and money managers reduced their bullish positions in COMEX gold and silver contracts in the week to September 10, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.

Newmont Goldcorp said on Sunday it has temporarily suspended operations at the Peñasquito gold mine in Mexico after the resumption of a previously lifted blockade by a trucking contractor and some members of the Cedros community.

Source: Reuters