Brent crude, the global oil benchmark, reached $92 a barrel last week, for the first time in two years and is up 28% on last year. Gold closed at a record high of $1,423 an ounce on Monday, up 23% over the same period. Strong demand for oil, particularly from emerging markets, is partly responsible for surging oil prices. Imports by China, the world’s second largest oil consumer after the US, surged 22.1% in November compared with a year earlier. However, OPEC disagrees with this take on events and, unusually, has not announced it will expand supply to suppress prices. They believe speculation, rather than fundamentals, is driving price rises.
Source: RBS Bank Economist