Oil prices fell on Friday after closing the previous session down about 1.6%, as the market’s risk premium faded following an agreement between Israel and Hamas on the first phase of a plan to end the war in Gaza.

Brent crude futures dropped 66 cents, or 1%, to $64.56 a barrel at 10:16 GMT, while US West Texas Intermediate (WTI) futures fell 61 cents, or 1%, to $60.90 a barrel.

Bjarne Schieldrop, chief commodities analyst at SEB, said, “The presence of a peace process in the Middle East has eased tensions somewhat,” noting that it could help calm concerns over oil tanker transit through the Suez Canal and the Red Sea.

Both Benchmarks Head for Weekly Gains

Israel and Hamas signed a ceasefire agreement on Thursday as part of the first phase of President Donald Trump’s plan to end the Gaza war.

Under the deal, approved by the Israeli government on Friday, fighting will stop and Israeli forces will partially withdraw from Gaza in exchange for Hamas releasing all remaining hostages captured in the attack that sparked the conflict, while Israel will free hundreds of Palestinian prisoners.

Since 2023, Iran-aligned Houthi forces in Yemen have repeatedly attacked vessels they claim are linked to Israel, in what they describe as solidarity with Palestinians during the Gaza war.

On a weekly basis, Brent crude is up roughly 1%, while WTI remains relatively flat so far, after both benchmarks posted sharp declines last week.

Prices had climbed about 1% on Wednesday to reach their highest levels in a week, as investors viewed stalled peace talks over Ukraine as a sign that sanctions on Russia — the world’s second-largest oil exporter — would remain in place.

Focus Shifts Back to Supply Surplus as OPEC Moves Forward

Daniel Hynes, commodities analyst at ANZ, said the ceasefire agreement in Gaza is refocusing the market’s attention on the expected supply surplus, as OPEC proceeds with its gradual unwinding of production cuts.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies in the OPEC+ coalition agreed last Sunday to a modest production increase for November — smaller than markets had anticipated — easing concerns about a potential oversupply.

In a note on Friday, research firm BMI wrote, “Market expectations for a sharp increase in crude supply have not materialized to the extent that would trigger significant price declines,” adding that the latest production rise was milder than previously feared, helping prices edge higher this week.

Eyes on the US Government Shutdown

Investors remain worried that the ongoing US government shutdown could weaken the country’s economy, leading to lower demand for crude oil in the world’s largest consumer.

Silver prices rose in the European market on Friday, extending gains for the third consecutive session and surpassing the $50-per-ounce mark for the first time in history, setting new record highs as the metal heads for its eighth straight weekly advance.

The rally was driven by the pause in the US dollar’s upward momentum against a basket of major currencies, alongside strong retail demand as silver remains comparatively undervalued relative to gold.

Price Overview

• Silver prices today: Silver rose 4.0% to an all-time high of $51.24 per ounce, up from the opening level of $49.28, after hitting a session low of $48.91.

• On Thursday, silver settled 0.8% higher, marking its second consecutive daily gain.

Weekly Performance

So far this week — which officially ends with today’s settlement — silver prices are up about 6.75%, on track for an eighth consecutive weekly gain, marking the longest winning streak since May 2020.

These weekly gains come amid strong demand for precious metals as safe-haven assets, driven by escalating political risks in France and Japan and concerns over the ongoing US government shutdown.

US Dollar

The US dollar index fell 0.2% on Friday, retreating from a two-month high of 99.56 points and heading for its first loss in five sessions, reflecting a pause in the currency’s recent rally against its major and minor counterparts.

Aside from profit-taking, the dollar’s decline came as expectations strengthened that the Federal Reserve will cut interest rates by 25 basis points in both October and December.

Retail Demand

As retail investors seek financial assets to hedge against risks associated with the global shift toward looser monetary policy, silver has emerged as the most attractive and undervalued option.

The ongoing surge in silver prices reflects growing recognition among retail traders that the white metal remains significantly underpriced compared to gold, which continues to hit new all-time highs.

The Japanese yen rose in Asian trading on Friday against a basket of major and minor currencies, attempting to recover from an eight-month low versus the US dollar recorded earlier in the session, as traders engaged in moderate buying from depressed levels.

Still, the yen remains on track for its biggest weekly loss in a year, pressured by expectations that Sanae Takaichi — poised to become Japan’s first female prime minister — will favor expansionary fiscal and monetary policies.

Price Overview

• USD/JPY rate today: The dollar slipped 0.25% to ¥152.64 from an opening level of ¥153.04, after touching a high of ¥153.27 — its strongest since February.

• The yen closed Thursday down 0.25% versus the dollar, marking a sixth straight daily loss amid ongoing political-driven selling pressure.

Weekly Performance

So far this week, the yen has fallen about 3.5% against the US dollar, heading for its third weekly loss in a month and its steepest since September 2024.

Political Pressure from Takaichi

The yen came under heavy pressure at the start of the week following Sanae Takaichi’s election as leader of Japan’s ruling Liberal Democratic Party, paving the way for her to become the country’s first female prime minister.

Her victory reinforced expectations that the incoming government will boost public spending and maintain loose monetary policy — factors weighing on the currency.

In her post-election press conference, Takaichi said the government and the Bank of Japan should work closely to achieve demand-driven inflation supported by rising wages and corporate profits.

Analyst Commentary

• Carol Kong, currency strategist at Commonwealth Bank of Australia in Sydney, said the USD/JPY’s rise has been “almost uninterrupted,” adding that only profit-taking could pause the uptrend.

• Kong added that confirmation of Takaichi’s appointment and the upcoming Bank of Japan meeting in October could be the next catalysts for further yen weakness, especially if she reaffirms her dovish stance and the BOJ signals no near-term rate hikes.

• Karl Schamotta, chief market strategist at Corpay in Toronto, noted that traders are increasingly skeptical about Takaichi’s ability to push through fiscal stimulus while resisting BOJ tightening plans.

• Schamotta added: “This reflects Japan’s underlying inflation dynamics — households are demanding change as inflation remains high.”

Japanese Interest Rates

• Following Takaichi’s victory, market pricing for a 25-basis-point BOJ rate hike in October fell from 60% to 25%.

• Yen swap markets now assign a 41% chance of a rate increase by December, down from 68% before the party election.

The 160 Yen Threshold

Atsushi Takeuchi, a former Bank of Japan official who participated in Tokyo’s market operations a decade ago, told Reuters that authorities may tolerate moderate yen weakness but could intervene if the currency plunges sharply toward ¥160 per dollar.

“Officials won’t mind if the yen’s decline remains gradual,” Takeuchi said. “Alarm bells will ring if traders start talking about a sharp fall toward 160 or 170 yen per dollar.”

He added, “If the yen drops that far, authorities can — and should — intervene. While intervention can’t change the broader market trend, it can slow or halt excessive declines in the yen.”

Bitcoin climbed above $122,000 in the past 24 hours, supported by hints from the US Federal Reserve suggesting that further interest rate cuts may be on the way.

Strong, sustained demand for spot Bitcoin exchange-traded funds (Spot Bitcoin ETFs) also helped lift the price of the world’s largest cryptocurrency by market capitalization.

Bitcoin (BTC-USD) rose in early Thursday trading, briefly surpassing $123,000 before paring gains to stabilize above $122,000, up around 1% for the day.

Despite these gains, and after reaching an all-time high above $126,000 earlier in the week, British investment platform Hargreaves Lansdown took a firm stance against the crypto sector.

In a statement to the Financial Times on Thursday, the company said: “We do not believe cryptocurrencies possess the characteristics that make them suitable for inclusion in investment portfolios, whether for growth or income purposes, and they should not be relied upon to help clients achieve their financial goals.”

The company added that “Bitcoin is not an investment asset class.”

This statement coincided with the UK Financial Conduct Authority’s (FCA) decision to lift a four-year ban on retail investors’ access to regulated crypto investment products.

However, Hargreaves Lansdown clarified it would conduct further risk assessments before deciding whether to offer access to exchange-traded notes (ETNs) linked to cryptocurrencies on its platform.

Fed Minutes Indicate Policy Shift

Hargreaves Lansdown’s cautious view of the crypto market comes amid a strong rally in digital assets, fueled by dovish signals from the US Federal Reserve and large inflows into Bitcoin and Ether spot funds.

On Wednesday, minutes from the Fed’s September meeting showed that about half of policymakers expect two additional rate cuts before year-end — signaling a more accommodative stance by the central bank.

Markets responded with broad gains across equities, cryptocurrencies, and commodities.

That same day, spot Bitcoin ETFs recorded net inflows of $441 million — the eighth consecutive day of positive flows — while spot Ether funds added another $69 million, underscoring renewed investor appetite for digital assets.

Meanwhile, gold surged above $4,050 per ounce for the first time, rising 11.7% in October and about 55% year-to-date, as growing fears over fiat currency weakness pushed investors toward tangible assets.

Timothy Messer, head of research at BRN, said: “The markets absorbed the week’s volatility and emerged stronger. The Fed minutes were the catalyst bulls needed — confirmation that monetary policy is tilting toward faster easing, not tightening. As a result, both gold and Bitcoin jumped, reaffirming the broader trend toward hard assets leading this cycle.”

He added that eight consecutive days of ETF inflows signal strong and sustained structural demand, while major corporations are expanding their participation by adding Bitcoin to their treasuries as a strategic reserve asset.

Messer also noted that easing geopolitical tensions — aided by the ‘Middle East Peace Framework’ brokered by President Donald Trump — reduced short-term volatility and gave traders a clearer outlook for the final quarter of the year.

Institutional Players Drive the Current Rally

Ryan Lee, chief analyst at Bitget, told Yahoo Finance UK that Bitcoin’s recent surge to record highs above $126,000 has been driven by increasing ETF inflows and growing institutional involvement.

Bitcoin hit a new all-time high of $126,198 on Monday, October 6, as investor enthusiasm for spot Bitcoin ETFs intensified.

“Market data shows that since the start of October, we’ve seen massive inflows into Bitcoin ETFs, peaking at over $1.2 billion on October 6 — a liquidity surge that translated directly into the record high of $126,198 that same day,” Lee explained.

He added: “With the ongoing US government shutdown, investors across segments have turned to Bitcoin and other assets as hedges against macro uncertainty. At the same time, exchanges are showing declining Bitcoin supply, reflecting a liquidity squeeze that could pave the way for further price appreciation.”

Lee noted that the current bull cycle differs from previous ones: “In addition to continuous accumulation by spot Bitcoin ETFs, corporations are now directly adding Bitcoin to their balance sheets as a primary store of value and inflation hedge.”