- WND - http://www.wnd.com -
Gold, oil skyrocket
Posted By -NO AUTHOR- On 04/17/2006 @ 2:42 pm In Front Page | Comments Disabled
Gold prices rose over 3 percent today on concern that growing tension over Iran’s nuclear ambitions may disrupt oil supplies.
Crude-oil prices reached $70 a barrel for the first time since Hurricane Katrina, with investors fearing rising inflation.
Spot gold closed up $18.20 to $614.50/oz., while silver rose almost 4 percent on hopes the first silver exchange-traded fund with soon launch, reported Swiss America. Silver jumped $.48 to close at $13.37/oz.
While the gold futures price crossed the $600 mark Tuesday, today was the first day spot gold closed above that level.
Although gold is at a 25-year high, many experts still see it as a prudent investment, especially in light of the U.S. dollar.
Federal Reserve Bank President Richard Fisher admitted Friday that the U.S. dollar is a “faith-based currency” dependent on the credibility of a central bank. “In addition to a faith-based currency, we are the currency of the world and we must maintain its integrity,” he said.
Craig R. Smith
Commented Craig R. Smith, CEO of Swiss America: “The rise of gold prices signals a loss of confidence in all ‘faith-based’ currencies worldwide. We’re witnessing an amazing transfer of wealth from West to Mideast. OPEC is raking in historically high profits, turning petrodollars into gold and divesting of U.S. dollars in the process. In my view, we’re only one major oil-terrorism-economic crisis away from $100 oil, $5 gas and $1,000 gold.”
The U.S. dollar declined the most since January versus the euro and yen as traders pared bets that the Federal Reserve will raise its benchmark interest rate twice more this year. The U.S. currency has declined about 3.4 percent this year versus the euro.
Aug. 30 was the last day crude futures touch $70 a barrel, closing that day at $69.81.
Concerns about oil supply disruptions in Nigeria also contributed to the rise in crude prices, the Associated Press reported.
ABN Amro broker Lee Fader told AP the trigger for today’s oil rally was “heightened fear about military action” against Iran, which has said it would go ahead with plans to enrich uranium.
“If somehow this got resolved diplomatically,” Fader said, “that would definitely take a few dollars off” the price of crude oil.
Related special offer:
Article printed from WND: http://www.wnd.com
URL to article: http://www.wnd.com/2006/04/35752/
© Copyright 1997-2013. All Rights Reserved. WND.com.