FX.co ★ 27.05.2022: Oil prices extend gains. Outlook for oil, gold, and RUB.

European Union leaders are set to meet again on May 30 in an extraordinary summit to discuss a new package of sanctions against Russia. Reportedly, the main issue will be an import ban on Russian energy supplies. In addition, China has begun to gradually ease its quarantine measures. Thus, increased demand from China coupled with supply disruptions will only add to confusion in the energy market. Now let's figure out what impact these factors have had on oil prices. Brent crude oil futures overcame a three-month high and then headed for the level of $120 per barrel. This growth can be limited only by the outcome of the next round of negotiations between European diplomats on anti-Russian sanctions. Moreover, this is possible only if the European Union does not impose an embargo. The sharply increased risks also had an impact on gold. Having reached the mark of $1,850 per ounce, the yellow metal began to gain value again. In just a few hours, it advanced to almost $1,860. Thus, there is a direct correlation with the energy market. Apparently, this situation will persist at least until Monday. Against this background, gold prices have every chance of breaking through the $1,860 mark and then moving towards $1,870 per ounce. Speaking of the ruble, the market response to a sharp reduction in the key rate to 11.0% from 14.0% by the Bank of Russia turned out to be rather weak and obviously limited. So, just a few hours later, the central bank eased the requirement for the mandatory sale of foreign exchange earnings of exporters, increasing the selling period to 120 business days. This measure turned out to be much more effective, and the ruble began to post steeper losses. In addition, economists predict that the Bank of Russia may lower the key rate further to 9.0% at the next rate-setting meeting scheduled for June 10. In this case, the dollar is expected to rise to at least 70 rubles. Moreover, there is a likelihood that the greenback will reach this mark as early as Monday.

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