Gold prices rose on Wednesday, extending gains for the second straight day, with support above the $1,800 barrier amid safe haven demand, while the US dollar faltered against its peers.

Gold prices rose 0.3% to $1,820.13, after opening at $1,814.73, and hit a day high at $1,812.59.

Gold closed higher by 0.7% yesterday, and recouped some of the heavy losses in the first session of the new year.

The dollar index fell 0.2% against a basket of major currencies today, and pulled back from its 2-week high of 96.46 points due to profit-taking.

Investors are also awaiting a slew of key data on the US labor market, which helps the market parse the Federal Reserve's rate hikes prospects in May.

Gold stocks at the SPDR ETF rose 4.65 metric tonnes yesterday, with the total at the highest since December 14 at 980.31 metric tonnes.

Oil prices fell on Wednesday, for the first time in 3 days, and pulled back from a 6-week high hit yesterday due to profit-taking, but today's losses remain curbed after a drop in the US crude inventories according to preliminary data, and ahead of the EIA's weekly report.

US crude fell 0.8% to $76.54 a barrel, after opening at $77.17, and hit a high at $77.24, and Brent crude fell 0.7% to $79.57 a barrel, after opening at $80.13, and hit a low at $80.14.

The US crude gained 1.6% yesterday, the second straight daily gain, and hit a 6-week high at $77.61 a barrel, and Brent rose 1.55%, and hit the highest level since November 26 at $80.54.

OPEC-Plus alliance decided to keep the current production policy unchanged, and moving forward to increase supply by 400,000 barrels in February.

The American Petroleum Institute reported in preliminary data that the US crude inventories fell 6.4 million barrels during the week ending December 31, while analysts forecast a drop by 4.4 million barrels.

The total commercial inventories in the US fell to about 421 million barrels, the lowest level since the week ending on September 17.

The US Energy Information Administration's official data will be released later today, amid forecasts for inventories to drop by 3.5 million barrels.

Sterling rose in European trade against dollar for second straight session, on track to hit two-month highs, on prospects of another UK rate hike next month.

GBP/USD rose 0.2% to 1.3554, with an intraday low at 1.3419, after rising 0.4% yesterday, marking two-month high at 1.3557, as UK government refused to impose new restrictions in the UK.

Last year, the pound lost 1% against dollar, the first loss in three years, but it was a rather small loss compared to other major currencies, as the UK continues to rebound economically, and following the December rate hike. 

The pound is also bolstered by the dollar amid prospects of a new UK rate hike next month.

These prospects increased amid reduced fears regarding the Omicron variant's impact on the economy, especially after the government refused to impose any new restrictions.

Oil prices rose on Tuesday, despite the dollar's rise against most major currencies, and ahead of the US inventories data.

Observers believe that a "corona tsunami" in the US means that infections are rising by 1 million cases every day, which has already happened during the past 24 hours.

The dollar index rose against a basket of major currencies by 0.1% to 96.3 points as of 19:06 GMT, after hitting a high of 96.4 points and a low of 96.03 points.

The American Petroleum Institute will release its preliminary report on the US crude inventories later today, and the US Energy Information Administration will release the official data on Wednesday.

WTI January futures rose 1.3% to $77.07 a barrel, as of 19:09 GMT.

Brent February futures rose 1.5% to $80.1 a barrel.