Russia has retaliated against several European countries by banning gas supplies to them, especially Poland and Bulgaria.
Such a move came as both countries failed to adhere to the condition of purchasing the gas with the Ruble.
This is the first time that Russia has cut supplies to European clients since launching its attack on Ukrainian land on February 24.
Polish sources asserted that Russian supplies were indeed cut from the country, with reserve covering the next month at least.
Poland criticized Russia for not adhering to their contracts, as the west and Russia continue to trade blows.
Naturally, gas prices surged by over 15%m, surpassing $1300 per thousand cubic meters.
Most European stocks took a hit as well after the Russian move.
EU countries are frantically looking for alternatives so far for gas supplies to move beyond dependence on Russian supplies.
Gold prices fell on Wednesday, resuming the losses and marking two-month lows as dollar strengthens.
Expect expect gold to give up $1900 an ounce and possibly hit $1800 if the dollar maintained momentum.
Gold prices fell 1% to $1886 an ounce, the lowest since February 25, after rising 0.4% on Tuesday, the first profit in four days.
The Dollar
The dollar index rose 0.5% on Wednesday for the fifth straight session, hitting two-year highs at 102.77, against a basket of major rivals.
Haven demand is boosting the dollar, as Chinese authorities continue to crack down on Covid 19 infections and lock up cities.
The Federal Reserve is also expected to hike rates in a very rapid pace throughout the year, boosting the greenback against rivals.
Estimates
Analysts expect gold to hover near $1900 for the time being, as dollar hits at two-year highs, with gold potentially tumbling towards $1800.
The SPDR
Gold holdings at the SPDR Gold Trust remained flat at 1,101 tone, the lowest since April 18.
Euro declined in European trade against dollar for the fifth straight session, giving up 1.06 for the first session in five years on concerns about energy disruptions in Europe as Russia said it'll cut gas supplies to Poland and Bulgaria.
EUR/USD fell 0.5% to 1.0585, after closing down 0.7% yesterday, the fourth loss in a row on bearish sentiment.
The Energy Crisis
Russia started to implement its threat by cutting natural gas supplies to several European countries that refused to pay with the Ruble, the strongest such response from the Kremlin on the sanctions so far.
Russia officially said it cut off gas supplies to Bulgaria and Poland for failing to pay with the ruble.
Europe remains highly dependent on Russian gas supplies, amounting to 40% of the continent's supplies.
The Dollar
The dollar index rose 0.5% on Wednesday for the fifth straight session to to-year highs at 102.77 against major rivals.
Haven demand is boosting the dollar, as Chinese authorities continue to crack down on Covid 19 infections and lock up cities.
The Federal Reserve is also expected to hike rates in a very rapid pace throughout the year, boosting the greenback against rivals.
Oil futures tilted higher in Asian trade off April 12 lows, even as the dollar eked out gains as well, ahead of important US inventory data later today.
Markets are still pricing the chance that Beijing will be locked up as well like Shanghai as Covid 19 continues to spread in major Chinese cities.
As of 06:39 GMT, US crude futures due in May rose 0.61% to $102.38 a barrel, while Brent June futures rose 0.52% to $105.92 a barrel, as the dollar index rose 0.18% to 102.45.
From the US, the goods trade deficit is expected down to $105 billion from $106.6 billion in February, while existing home sales are expected down 1%.
The ongoing crisis in Ukraine continues to underpin energy prices worldwide as Europe and US continue to impose severe sanctions on Russian supplies.
Russian President Vladimir Putin said he's open to negotiations with Ukraine, and hoped for positive results, and added the situation in Mariupol is difficult and tragic, asking the Ukrainian army to let civilians leave.
Latest World Health Organization data showed Covid 19 infections rose to 508.04 million cases, with the death toll mounting to 6.224 million.
Baker Hughes data showed US oil rigs rose by 2 to 548 rigs, the highest since October 2018, with total output up by 100 thousand bpd to 11.9 million bpd.