Oil market rout enters seventh successive trading day iStock

Oil futures fell for the seventh successive trading session on Friday (29 July) following continued oversupply concerns, while gold gained ground on a weaker dollar and safe-haven calls by investors.

At 2.54pm BST, the Brent front-month futures contract was down 2.01% or 86 cents to $41.86 per barrel, while the West Texas Intermediate was 1.24% or 51 cents lower at $40.63 per barrel, with the market poised for a 20% drop since early June.

Analysts at Morgan Stanley predict crude oil could again slump toward $30 (£23, €27) per barrel, as supply outages get resolved and major oil producers keep the taps on.

Meanwhile, analysts at Vienna-based JBC Energy said the market has had to contend with the full return of Canadian barrels as well as an uptick in US drilling activity and somewhat disappointing refinery runs.

"However, the trend of transatlantic divergence is already beginning to correct itself as the wider Brent/WTI spread de-incentivises US imports of Brent-related grades, while also incentivising some exports of US crude," they added.

Meanwhile, precious metals were led higher by gold as a weaker dollar and volatility elsewhere perked up safe-haven demand.

At 2.54pm BST, Comex gold futures contract for December delivery was up 0.50% or $6.50 to $1,338.80 an ounce, after both the Bank of Japan and US Federal Reserve held back from making major monetary policy overtures.

Concurrently, Comex silver was broadly flat at $20.20 an ounce, while spot platinum was 0.76% or $8.60 higher at $1,142.70 an ounce. Sentiment towards the US economy was also dealt a blow during trading on Friday following the soft second-quarter gross domestic product (GDP) result of 1.2%, which widely missed expectations and renewed concerns over the health of the US economy.

FXTM research analyst Lukman Otunuga said: "This unexpected rate of growth may potentially diminish optimism towards the Fed raising US interest rates in 2016. Although the outlook for the US economy still looks somewhat encouraging, future domestic data may have to repeatedly exceed expectations for the Fed to break the chain of central bank inaction.

"It should be kept in mind that the engine behind the dollar's recent resurgence has been US rate hike expectations and if this starts to fade, then bears may waste no time to drag the currency lower."