Economy

Gas Prices
Gas Prices Soar in Europe – Risk of 100 Percent Rise

Natural gas prices in Europe are soaring after the weekend’s escalated fighting in the Middle East, writes Bloomberg. Trade through the Strait of Hormuz – one of the world’s most important energy routes – has largely ground to a halt, causing the market to price in the risk of a halt in LNG flows.

European futures contracts have been up around 25 percent, the biggest one-day move since August 2023. The situation could be the most serious shock to the gas market since Russia’s invasion of Ukraine.

Europe is being singled out as particularly vulnerable, with unusually low inventories and a large need for LNG imports this summer ahead of winter. Goldman Sachs warns that a month-long shutdown in Hormuz could cause prices to more than double.

Gold Price
Gold Price Climbs as Investors Seek Safety

Gold prices are rising for the fourth day in a row after the sharp escalation in the Middle East, Bloomberg reports. In early trading, the price was up 2.2 percent to more than $5,390 an ounce, before some of the rise fell back.

When uncertainty increases, investors often turn to assets perceived as safer – and gold tends to be high on the list.

Analysts at the Franklin Templeton Institute recommend selective exposure to gold rather than broad shorting of stocks.

So far this year, gold prices have risen about 25 percent, driven by geopolitical concerns, large central bank purchases and a broader move away from bonds and currencies.