Uncertainty in the markets after the Paris attacks has caused investors to move money into many traditional “safe haven” assets such as gold, treasuries, and unaffected foreign currencies. However, while the value of these assets has risen, oil prices remain stubbornly low.
On the Monday after the Paris attacks, where a series of gun and bomb attacks across the French capital left 129 people dead and more than 400 injured, spot gold prices increased close to one percent. In the first 10 minutes of that session, $316 million (£210m) was traded, nearly 10 times the average of trading over the last two months.
Other precious metals also considered safe havens were also affected by a surge in trading and prices following the attacks, with both silver and platinum rising by one percent.
The instability and fear within Europe after the attacks caused the Euro to fall in value by almost one percent, declining to its worst level since April. But as the Euro declined, the Japanese Yen, with investors seeing the isolated island of Japan as a safe haven away from the two major issues facing Europe – the threat of terrorism from militants linked to the Islamic State and the surge in refugees fleeing from Syria.
Some investors warn that the boost in value for the Yen may be short lived because Japan has recently once again fallen into recession after decades of little or no growth, while others look into spread betting and other financial instruments to manage the volatility and create the possibility of benefiting from either a rise or fall of the currency.
Traditionally, oil prices also see a pricing surge as investors become nervous about current events, but the glut of oil available on the market has resulted in significantly lower growth than in similar situations in the past. The continuing instability in the Middle East, with large oil producing countries such as Saudi Arabia and Iran both heavily involved officially and unofficially in the conflicts in Syria and Yemen, have also had little effect with the cost of a barrel of oil at around its lowest price in the decade.
The oil market saw a very slight bump in the Monday following the attacks, but the upward pressure of global uncertainty is currently outweighed by the excess of oil on the market and the move by the US towards local fracking and natural gas and away from oil imports as its main source of energy.
