Gold and silver prices rose more than 1% on Monday as investors fled to safe havens after an attack on Saudi oil facilities raised concerns about global energy supply and tensions in the Middle East.
Spot gold rose 1.27% to $ 1,507.40 an ounce, while US gold futures rose 0.83% to $ 1,512.1. The gold-backed exchange-traded SPDR Gold Trust fell 0.82% to $ 140.15 on Friday, holding 874.51 tonnes of gold in trusts.
Like gold, silver is considered a safe investment, but the metal is also used in the production of consumer electronics as well as in the industrial sector, such as solar panels. Cash-on-silver increased 2.96% to $ 1
The moves took place after Saudi Arabia halted half of its oil production on Saturday after a series of drone strikes hit the world's largest oil processing facility. The attack was asserted by Yemen's Houthi rebels, and the Trump government blamed Iran.
According to Saudi Aramco, this closure will affect nearly 5.7 million barrels of crude oil per day. That's about 5% of the world's daily oil production. According to the US Energy Information Administration, Saudi Arabia produced 9.85 million barrels a day in August.
The Kingdom's Energy Minister said the attacks also led to a cessation of gas production that would reduce natural gas supplies by 50%.
US Crude oil and Brent prices rose more than 9% every Monday morning during Asian hours.
The attack exacerbated tensions in the Middle East after the US blamed Tehran for the strike, calling it an "unprecedented attack on the world's energy supply." US President Donald Trump said the US was "blocked and loaded," but his government is waiting for Riyadh to determine who initiated the strike before taking action. Iran has rejected these allegations as "meaningless".
Elsewhere, the US Open Market Committee is scheduled to meet on Tuesday and Wednesday, and markets expect the central bank to cut rates by a quarter.
Global growth prospects remain subdued in light of the continuing US-China trade war, which could potentially sustain demand for safe havens. Chinese Premier Li Keqiang recently said in an interview that it is "very difficult" for the world's second largest economy to maintain a growth rate of 6% or more.