Spot gold opened higher on Monday (June 27), with news over the weekendG7 Group to announce a ban on the import of Russian gold。

Fu Tu Niu Niu APP$Gold (BK0309.SH) $The plate (A shares) closed up 1.41%; the Hong Kong stock gold sectorGold and precious metals (BK1084.HK) $It closed up 4.22%, and among the constituent stocks$Zijin Mining Group (02899.HK) $Increase by more than 4%China Gold International (02099.HK) $、$Shandong Gold Mining (01787.HK) $It's up more than 3%.

At the same time, WTI crude oil and Brent crude oil fell first and then rose in early trading. As of the press release$WTI crude Oil main Company (2208) (CLmain.US) $Hong Kong oil sector fell 0.25%.Oil shares (BK1205.HK) $It closed up 1.72%.It was reported over the weekend that the G7 group was discussing capping Russian oil prices through insurance and shipping restrictions.

Impose caps on Russian oil prices through insurance and shipping restrictions

The G7 countries are trying to limit Russia's energy revenues while mitigating the impact on their economies amid soaring inflation and efforts to curb dependence on Russian oil and gas.

The G7 is discussing capping Russian oil prices by imposing restrictions on insurance and shipping, according to people familiar with the matter.

This potential mechanism will only allow the transport of Russian crude oil and petroleum products sold below the agreed threshold, according to people familiar with the matter. They pointed out that discussions between G7 leaders and officials are ongoing and no agreement has been reached.

Ban on the import of Russian gold

U.S. president Joe Biden and other G7 leaders will agree on a ban on new gold imports from Russia and expand sanctions against Russia, according to the website.

Sources said that the US Treasury Department will order on the 28th (next Tuesday) to ban the import of new Russian gold and prevent Russia from participating in the gold market, which is intended to make Russia pay a heavy economic price quickly and unable to obtain the funds needed for the war.

Russia, which produces about 10 per cent of the world's gold every year, overtook Australia as the world's second-largest gold producer in 2019, and most of Europe's gold comes from Russia.

Although the earlier sanctions imposed by the West on Russia have largely prevented gold markets in Europe and the United States from obtaining Russian gold.But the latest G7 ban will mark a complete sever of ties between Russia and the world's two largest gold trading centres, London and New York.

London has always been one of the most important destinations for Russian precious metals. Russian gold shipped to London last year was worth $15 billion, accounting for 28 per cent of UK gold imports, according to the UN Comtrade.

Other metals such as copper, nickel and palladium from Russia continue to enter the market. Russia's gold industry is looking for new sales options, such as exporting more products to China and the Middle East, which are not part of the G7.

What is the impact of this move of the G7 Group on the future trend of gold and crude oil?

Bank of America: European sanctions hit Russian supplies, oil prices could soar to $150 a barrel

Bank of America Corporation analysts believe that with the gradual implementation of the EU oil embargo on Russia for the rest of the year, it has hit Russian production, resulting in more and more oil disappearing from the global market and prices soaring.

BofA said the international oil benchmark should average $102 a barrel in 2022 and 2023. If European sanctions push Russian oil production below 9 million barrels a day, oil prices could soar to $150.

Some analysts also said that due to the continuing conflict between Russia and Ukraine, the global crude oil supply is still quite short, and as the epidemic control is lifted, the market demand rises sharply, and the relationship between supply and demand becomes more and more tight, so there is a high probability that crude oil prices will rebound.

Futu Information has previously sorted out the rise in the energy sector of US stocks in the first half of 2022.Since the beginning of 2022, the energy sector has led the way among the major sectors, with a cumulative increase of 56.32%.

As of June 8$Western Oil (OXY.US) $It has risen 143.94% this year, ranking first on the list of u.s. energy stocks. Apart from that$Exxon Mobil Corp (XOM.US) $Also performed well, the stock price has risen 72.56% since the beginning of the year, with a market capitalization of more than $435.4 billion. Wall Street banks Evercore, Credit Suisse and Goldman Sachs Group have raised their target prices one after another, and Evercore is bullish on it to $120.

The monetary attribute of gold is still the main line of the market, and the downward space for gold under the interest rate hike and contraction table may be limited.

The current survey shows that analysts are widely divided on the gold future, a little more neutral views, most individual investors still tend to be bullish on gold.

There is no doubt that, compared with the supply and demand side of gold, the core factor affecting the price of gold is still the monetary attribute of gold. Gold, an interest-free asset, has continued to sell off over the past three months as major central banks such as the Federal Reserve accelerate monetary tightening, so whether gold stops falling depends more on judgment on US monetary policy.

Some analysts believe that further tightening of liquidity may trigger a general decline in commodity prices, including gold, and gold will start a "final decline" in the second half of the year.

However, as liquidity tightening expectations hit the ground, fears of a US recession are rising, and safe-haven funds are expected to seek a "substitute" for the safe-haven dollar. This could limit gold's further significant downside.But for now, investors should wait patiently for a clearer signal of gold's turnaround.

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Negative view: the new sanctions against Russia by the G7 have no effect?

However, some analysts believe that the G7 new sanctions on Russia are not expected to have any effect.

At present, the crude oil market is tight and needs the supply of Russian oil, and no other oil-producing country has extra capacity to make up for the loss of supply.

Considering that oil revenue mainly comes from two sources: oil prices and export volume, if you want to cut Russian oil sales, you can either cut exports or cut prices.But the West does not want to cut the quantity, so the price is left.

Restricting the price of oil sold by Russia will reduce Russia's oil revenue on the one hand and will not affect the amount of oil on the international market on the other. That sounds good.

But why didn't the United States take similar measures against Iran or Venezuela before?

Energy market analyst Julian Lee pointed out that the main reason may be that the implementation of price caps is not very effective.

Under the current plan, the goods will not be insured if the buyer pays Russia more than the set limit. Since about 95 per cent of the world's tanker fleet is insured through the International Organization for Protection and compensation in London and some companies in continental Europe, such a ban is feasible, but Lee believes it is not enough.

At the same time, Russia has begun to implement an alternative insurance scheme to provide insurance through the Russian State Reinsurance Company. That may be enough for India and China, which buy most of Russia's current oil.

Lee believes that the biggest obstacle to limiting Russian oil prices will be Putin's opposition. Western countries can set price caps at a level that ensures that Russian oil companies earn only a small amount of revenue and expect them to export at that price.

But the problem is that oil companies are not the ones who make the final decision. their oil is shipped to market through a network of Russian-owned pipelines.Mr Putin only needs to order the pipelines to be shut down, even if the oil companies want to export them.

Lee pointed out that Putin believes that cutting off Russian oil exports will do more damage to the European economy than to Russia. It is therefore impossible to expect Mr Putin to acquiesce in the price caps imposed by the west.

In addition, some analysts believe thatThe G7 ban on imports of new gold from Russia is also ineffective, only symbolically, because the trade flow of Russian gold has already been restricted by sanctions.