This article is general information, not a recommendation to buy or sell anything. Academy articles are prepared by the ETTFOS team and other writers. They make no claim of expertise or accuracy, and they are not kept up to date after they are published.
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Gold and oil are both commodities traded around the world, and they move for very different reasons. Oil is consumed: it moves goods and people. Most gold is kept, as jewelry, bars, coins and central bank reserves.
This article sets out what official sources say drives each one. It makes no forecast.
Oil: a global auction
Crude oil prices are driven by global supply and demand, the US Energy Information Administration (EIA) says, and economic growth is one of the biggest factors on the demand side.
The world’s transportation depends almost totally on petroleum products. Growing economies need more energy, especially to carry goods from producers to consumers.
The EIA calls oil markets essentially a global auction. When markets are tight, the bidder must pay more; when they are loose, a buyer can wait for lower-priced supplies.
Producers, spare capacity and stocks
The Organization of the Petroleum Exporting Countries (OPEC) can significantly influence oil prices by setting production targets for its members, the EIA notes, though members’ compliance with those targets is mixed.
Spare capacity is the cushion. The EIA defines it as output that can be brought online within 30 days and sustained for at least 90 days, which producers can use to moderate price increases when supply is disrupted.
Inventories are the other cushion. When spare capacity and inventories are low, the EIA says, a potential disruption may have a greater impact on prices than current supply and demand alone would suggest.
The EIA publishes US crude oil and product stocks every week, in its Weekly Petroleum Status Report.
In October 2026 the World Bank put it plainly: with oil stocks depleted, the world is more exposed to further supply shocks.
Disruptions, weather and financial markets
Geopolitical events and severe weather that disrupt the flow of oil can affect prices, the EIA explains, partly because they create uncertainty about future supply or demand.
In the short term, supply and demand respond little to price, so it can take a large price change to rebalance them.
The effect of weather, refinery outages and pipeline problems tends to be short-lived: once the disruption subsides, the EIA says, prices usually return to their previous levels.
Futures trading plays its part. Oil futures are traded by producers and consumers, and by participants who neither produce nor use oil. When such positions are large enough, the EIA notes, price movements can temporarily diverge from the fundamentals.
Positions are public in summary. Each week the CFTC’s Commitments of Traders reports break down open interest in futures and options markets, with data from Tuesday generally released on Friday.
Gold: a metal that pays no interest
Gold is used differently. Not counting exchange-traded funds, the US Geological Survey estimates that jewelry took 40% of global gold consumption in 2025, physical bars 24%, central banks and other institutions 21%, and electronics 7%.
Supply changes slowly. World mine production was an estimated 3,300 metric tons in 2025, against 3,280 in 2024.
Because so little of it is used up, gold’s price leans on why people want to hold it.
Holding it pays nothing. The European Central Bank lists that among gold’s limits as a reserve asset: its price is volatile, it is not remunerated and, when held in physical form, it is costly to store.
That is why interest rates matter to it. In October 2026 the World Bank wrote that higher-for-longer interest rates or a stronger US dollar could depress precious metal prices, while geopolitical tensions or financial market volatility could lift them.
Central banks and uncertainty
Central banks are large buyers. The ECB reports that their purchases eased to around 850 metric tons in 2025, from over 1,000 metric tons a year between 2022 and 2024, and stayed higher than historical norms.
Survey data, the ECB adds, suggest that central banks hold gold not only for diversification but also as a hedge against geopolitical risk.
Safe-haven demand works the same way. Intensifying geopolitical or trade-policy tensions could strengthen it, the World Bank says, and a durable easing could reduce it.
Safe haven does not mean safe. The CFTC warns that gold and other precious metals are highly volatile, and that past performance is not a good predictor of future returns.
What the quoted price leaves out
The spot price is the cash price for immediate delivery, quoted in dollars per troy ounce. A dealer always sells metal above it and buys it back below it; the difference is the dealer’s spread.
The CFTC notes that some fraudulent dealers have charged spreads of more than 300 percent, while others charge less than 20 percent. The greater the spread, the more the spot price has to rise before a buyer can make a profit.
Gold futures add leverage. In the CFTC’s example, gold trades in 100-ounce contracts, held with a margin far smaller than the contract’s value, so every $1 fall in the price costs $100.
The takeaway
Oil moves with the physical balance of a fuel the world burns every day. Gold moves with the reasons people and central banks hold it, and with the interest it does not pay.
Both can move sharply, for reasons no one controls. Knowing what drives them is not a forecast, and it is not a reason to trade.
Your results will depend on your own decisions, your capital and market conditions, and you can lose money.
