Gold touches new peak amid trade fears, oil remains sluggish

Gold prices surged to a new all-time high on Monday, reaching $3,245.75 per ounce, as escalating trade tensions—particularly the Trump administration’s tariffs on China, which now reach as high as 145%—sparked a flight to the traditional safe-haven asset.

This marks nearly the 20th time gold has broken records this year, gaining over 23%, or roughly $600, from its January level of $2,658. The latest rally comes in the wake of sweeping tariff measures targeting 185 countries, with rates ranging from 10% to 49%.

While gold continues to shine, oil prices remain subdued amid persistent recession fears. U.S. benchmark West Texas Intermediate (WTI) crude futures edged down 0.3% to $61.34 per barrel, while international benchmark Brent crude slipped by the same margin to $64.58—both hovering near five-year lows.

$4,000 in sight for gold, oil may sink to $40

Goldman Sachs has raised its year-end 2025 gold forecast from $3,300 to $3,700 per ounce, driven by stronger-than-expected central bank demand and growing recession risks likely to boost ETF inflows. The bank now sees gold trading within a range of $3,650 to $3,950, citing the metal’s sharp recovery after the April 2 sell-off caused by new tariff announcements.

Swiss lender UBS also had revised its forecast, increasing its 2025 gold target from $3,200 to $3,500. In a note on Friday, strategist Joni Teves said heightened tariff uncertainty, weaker global growth, rising inflation, and ongoing geopolitical tensions have made gold allocations more compelling.

On the energy front, Goldman Sachs expects oil prices to remain under pressure due to elevated supply from OPEC+ and persistent recession fears. The bank sees Brent and WTI crude averaging $63 and $59 per barrel, respectively, in the second half of 2025 and falling to $58 and $55 in 2026. Oil demand is forecast to rise only modestly—by 300,000 barrels per day—through the end of next year.

Goldman also cut its 2026 fourth-quarter global demand growth estimate by 900,000 barrels per day due to the intensifying U.S.-China trade war. Even accounting for possible inventory builds, the bank warns that expected surpluses of 800,000 barrels in 2025 and 1.4 million in 2026 could drag prices down further. In a scenario where the global economy slows sharply or OPEC+ reverses its 2.2 million barrel-per-day voluntary cuts, Brent crude could plunge to the $40 range—or below.