By Konstantinos Chrysikos, Head of Customer Relationship Management at Kudotrade
The rare escalation in tension in the Middle East, as Hamas officials are targeted in Qatar, carries significant market implications. For gold, the attack is likely to reinforce safe-haven demand, as investors hedge against heightened geopolitical uncertainty. The metal is already finding support from expectations of US monetary easing, and any sign of broader regional instability could sustain inflows into safe-haven assets.
Oil markets reacted swiftly, with Brent crude climbing to USD 67 per barrel. Qatar’s role as both a key energy exporter and a diplomatic mediator means that any disruption to its stability could affect supply expectations. This comes against the backdrop of a modest OPEC+ production increase, China’s continued stockpiling, and renewed fears of Western sanctions on Russia, all of which add to upside pressure on crude.
Equity markets in the Gulf may face additional headwinds. Indices in the region could experience selling pressure at the next open, as investors move toward safe-haven assets. Risk appetite could take a hit during a period of price corrections.