With the Russians taking over a natural gas station in the village of Strilkove, Ukraine, the tensions are heated up again as EU and US impose sanctions against Russian and Ukrainian officials who are deemed responsible for a contested independence referendum in Crimea. Crimea’s regional assembly declared independence from Ukraine after the referendum, and applied to join Russia. The US and EU condemned it as illegal and in violation of Moscow’s own international commitments to preserve the territorial integrity of Ukraine.
Analysts believe that the tensions in Ukraine will further push up precious metal, and gold prices are expected build on its recent gain of 14% this year. Bullion prices closed at $1,382 on Friday, the highest level in six months, and the sixth straight weekly rise. On a similar trend, gold April contracts, the most active contract, gained $6.60 to settle at $1,379.00 a troy ounce on the Comex division of the New York Mercantile Exchange, up 3% on the week.
The increasing political tensions will continue to affect gold prices and traders are closely following the move.