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Below the Quote on Gold and Crude 14th Aug 2025 by Kaynat Chainwala, AVP - Commodity Research, Kotak Securities

Spot gold rose marginally on Wednesday, settling above $3,355 per ounce, marking a second day of advances amid a weaker US dollar and growing expectations of interest rate cuts. The dollar fell to a two-week low, while US 10-year Treasury yields edged lower. CME FedWatch shows a 94% probability of a September rate cut following mild July inflation data, limited tariff pass-through, and earlier weak jobs data, with another cut expected by year-end. Geopolitical tensions in Ukraine and the Middle East, alongside ongoing US tariff risks, continue to underpin safe-haven demand. Today, gold extends gains to trade above $3,365 ahead of US PPI and jobless claims data. However, optimism over trade, as Washington and Beijing extended their tariff truce by 90 days, and upcoming talks between US, European, Ukrainian, and Russian leaders, could temper further upside.

WTI crude oil prices dipped below $62 per barrel, the lowest level since early June, pressured by supply glut concerns raised by the IEA and bearish EIA inventory report. In its latest monthly report, the IEA projected global oil supply will increase by 2.5 million bpd in 2025, up from the previously forecast 2.1 million bpd and by a further 1.9 million bpd in 2026. Meanwhile, global oil demand is now expected to grow by only 680,000 bpd in 2025 and 700,000 bpd in 2026, both figures revised down by 20,000 bpd from last month’s estimates. As per IEA, Oil inventories will accumulate at a rate of 2.96 million barrels a day, surpassing even the average buildup during the pandemic year of 2020. IEA expects a bigger surplus in line with EIA and contrasts with OPEC's latest report, which maintained a more optimistic tone, stating that demand is expected to strengthen in 2026 due to anticipated economic growth in key oil-consuming regions. Further, the EIA reported a surprise build in U.S. crude inventories, which rose by 3 million barrels in the week ending August 8. Oil prices attempted a modest recovery today, hovering near $63 per barrel as traders remain cautious ahead of a high-stakes meeting between U.S. President Donald Trump and Russian counterpart Vladimir Putin in Alaska tomorrow. Trump has warned of "severe consequences" if Putin refuses to agree to a ceasefire in Ukraine, while Ukrainian President Volodymyr Zelenskiy reiterated that he would not cede the eastern Donbas region to Russia.