On April 8, global commodity markets showed a clear divergence: gold prices surged strongly while crude oil experienced a sharp decline, creating a stark contrast between the two core assets.
In the gold market, both spot and futures prices rose simultaneously. At the time of writing, spot gold in London was quoted at $4,790.72 per ounce, up 1.9% for the day, having reached an intraday high of $4,857.55. COMEX gold futures rose 2.65% to $4,809 per ounce, with an intraday peak of $4,888, moving in sync with the spot market and driving prices higher.
In sharp contrast, international crude oil futures suffered heavy losses on the same day. At the time of writing, WTI crude plummeted 16.18% to $94.67 per barrel, hitting an intraday low of $91.05. Brent crude futures also fell sharply, dropping 13.95% to $94.03 per barrel, with an intraday low of $91.70.
The primary driver behind this volatile market movement was a significant shift in the Middle East situation. In the early hours of April 8 Beijing time, the U.S. President announced that, following a mediation request from the Pakistani Prime Minister, he agreed to suspend bombing and attacks on Iran for two weeks, provided Iran fully, immediately, and safely opens the Strait of Hormuz, constituting a "two-way ceasefire." The U.S. President stated that the U.S. had received a 10-point proposal from Iran, which he deemed a feasible basis for negotiations, with the two-week period intended to finalize an agreement. Iran's Supreme National Security Council subsequently announced its acceptance of the ceasefire proposal, with U.S.-Iran negotiations scheduled to begin in Islamabad on April 10 for a two-week period. White House officials confirmed that Israel had also agreed to a temporary ceasefire.
Analyzing the divergence between gold and oil, Wang Weimang, Investment Manager at Zhonghui Futures Asset Management Department, explained that the previous de facto blockade of the Strait of Hormuz had driven oil prices higher, increasing energy costs globally and intensifying inflationary pressures. Market expectations for Federal Reserve interest rate cuts had diminished from around two cuts at the start of the year to zero, with some even betting on rate hikes. The ceasefire agreement suggests the strait may gradually reopen, causing oil prices to plummet and signaling a potential reversal in inflation. Markets quickly priced in the logic of "lower oil prices or potential rate cuts," reducing the opportunity cost of holding gold as a non-yielding asset and boosting investment demand and prices.
Looking ahead to the negotiation period from April 10 to 24, Wang expects gold prices to exhibit high volatility with a tendency to trade within a range. Positive factors include: uncertainty surrounding the negotiations, as Iran's 10-point proposal and the U.S. stance remain far apart, making a comprehensive agreement within two weeks unlikely—any deadlock or breakdown could reignite safe-haven buying and push gold higher; a weakening U.S. dollar trend, as continued negotiations may further ease concerns about broader conflict, reducing the dollar's safe-haven premium and indirectly benefiting gold; and continued central bank gold purchases, providing solid long-term support.
However, Wang cautioned that downside risks for gold remain. If negotiations yield unexpected breakthroughs, gold may face profit-taking pressure. Should U.S. CPI and PCE data exceed expectations this week, it could dampen rate cut expectations. In the medium to long term, regardless of negotiation outcomes, gold's price trajectory is expected to trend upward amid the Federal Reserve's rate-cutting cycle and weakening dollar credibility, as it remains a high-quality asset backed by sovereign credit.
Xia Yingying, Head of Precious Metals and New Energy Research at Nanhua Futures, added that the temporary easing of conflict, combined with renewed rate cut expectations, supports gold investment demand. A weaker U.S. dollar and lower Treasury yields further enhance gold's valuation. While maintaining a long-term bullish outlook, medium-term trends will depend on the Federal Reserve's monetary policy pace—delayed rate cuts do not alter the long-term upward direction. Short-term caution is advised due to potential geopolitical fluctuations. Strategically, pullbacks should be viewed as opportunities for long-term positioning, while short-term traders may consider range trading.
Regarding oil trends, Ling Chuanhui, Energy and Chemicals Analyst at Nanhua Futures, noted that despite the sharp decline, it is premature to declare a trend reversal. Significant differences between the parties make a short-term agreement unlikely, and the possibility of "fighting while talking" could lead to price spikes. Brent crude at $85–$90 per barrel represents a relatively fair valuation; while short-term trading may reflect strait reopening expectations, $85 is likely a firm near-term (1–2 months) support level.
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