The aborted rebellion in Russia over the weekend is lifting oil prices and gold, but markets so far aren’t seeing big swings after the events.
In times of heightened geopolitical uncertainty, safe-haven assets such as gold and the U.S. dollar tend to rise while riskier assets tend to fall. While there have been some moves in that direction, they have been limited. Russia’s Defense Minister Sergei Shoigu was shown in a video on Monday visiting troops, demonstrating that he’s still in his post as the regime tries to restore calm.
Russia is one of the world’s largest producers of oil and instability in the country—with President Vladimir Putin’s grip on power weakened—could threaten output. Traders may also be waiting to see how big the fallout is from the rebellion led by Yevgeny Prigozhin, the head of the mercenary group called Wagner Group. Prigozhin called off the uprising after a deal was negotiated by Belarus.
“The muted response probably reflects a lack of clarity over what comes next after this challenge to President Putin’s authority,” said Chris Turner, a strategist at ING. Markets have also “already experienced a year of a stronger dollar and higher energy prices after the Russian invasion of Ukraine.”
Brent crude, the international benchmark, added 0.7% to $74.40 a barrel. West Texas Intermediate was up 0.6%.
Separate to the events in Russia, the Organization of the Petroleum Exporting Countries on Monday predicted that global oil demand will keep rising for the next two decades. Overall energy demand will climb 23% by 2045, it said.
Gold gained 0.3% to $1935.50 an ounce. Japan’s Nikkei index closed 0.3% down, while stocks in Hong Kong were down about 0.5%.
U.S. Secretary of State Antony Blinken said the rebellion showed “real cracks” in Putin’s power.
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