Could OPEC’s strategy shift and gold’s retreat set the tone for H2?

For years, commodities danced to the tune of crisis. OPEC+ fought market gravity with production cuts, while gold soared on fear and uncertainty. But as 2025’s second half approaches, the signals are changing - and fast.

Oil prices are rising, even as supply increases. Gold is falling, not on weak fundamentals, but on improving sentiment. This isn’t just a market quirk - it could be the early signs of a deeper shift: from reactive panic to strategic positioning.

Are we entering a new phase where commodities stop echoing headlines - and start setting the temp.

OPEC increases oil production

For two years, OPEC+ played the role of market caretaker - trimming supply, steadying nerves, and trying to prop up prices through sheer will. But 2025 has brought a decisive shift. Instead of more cuts, the group is ramping up production - and yet, oil prices are holding firm.

The announcements of successive supply increases, totalling over 800,000 barrels per day, initially raised eyebrows. But this isn’t an act of desperation, it looks more like a calculated repositioning. Saudi Arabia not only raised output but also hiked its official selling prices to Asia. That’s not what you do when you’re losing control - that’s a strategic flex.

Still, there’s tension behind the scenes. A Reuters report suggests further increases could be on the horizon. If compliance continues to falter, the 2.2 million barrels per day in voluntary cuts from eight OPEC+ countries risk being entirely reversed by October or November.

Kazakhstan and Iraq have repeatedly exceeded their quotas, either ignoring agreed cuts or only partially delivering them. This ongoing lack of discipline is preventing the group from correcting the previous oversupply. And it seems Saudi Arabia’s patience is wearing thin.

If this trend continues, the market could tip into surplus much earlier than expected and potentially stay that way through the rest of 2025.

That said, the headline numbers may overstate the impact. Kazakhstan is already producing well above its adjusted limit, so has little room to increase further. Iraq is likely to be forced into fresh compensatory cuts soon, while the UAE’s capacity to pump more is limited.

OPEC’s own data suggests the real increase between March and June may be closer to 600,000 barrels per day, not quite the flood some feared.

OPEC+ may be sending a message to its own members, markets, and competitors. It’s testing sentiment, keeping options open, and applying pressure while allowing external factors, like easing US-China tensions, to give oil prices an extra lift.

Rather than losing their grip, OPEC+ may just be changing tactics - quietly navigating rather than openly steering the market.

Gold’s price forecast: Confidence or complacency?

Meanwhile, gold has had a rough month.

Prices plunged nearly 9% from April’s record highs, dipping below $3,200 after a wave of optimism swept markets. The catalyst? A surprisingly friendly round of US-China trade talks, plus news that Iran may be ready to ink a new nuclear deal. Suddenly, the world felt a little less scary.

But let’s not get ahead of ourselves.

Yes, gold thrives on uncertainty - but that doesn’t mean its case disappears the moment markets calm down. Inflation, central bank gold buying, and simmering geopolitical risk haven’t magically vanished. They’ve just been pushed off the front page.

In fact, even after the sell-off, gold remains one of 2025’s top-performing assets. Smart money knows that peace talks can stall and inflation can roar back without much warning. This dip? It might just be the breather before the next leg up.

The bigger picture: Market sentiment vs substance

What makes this moment interesting is that both oil and gold are moving in ways that challenge conventional logic. Oil is rising despite more supply, while gold is falling despite strong fundamentals.

Why? Because sentiment is shifting.

Markets aren’t reacting to events - they’re reacting to expectations. And for the first time in a while, expectations are leaning positive. That creates room for commodities to behave more like markets - and less like emotional barometers.

What’s the trading outlook for H2?

If oil keeps climbing while gold cools, we could be looking at a broader sentiment reset: a market that’s less focused on fear and more focused on fundamentals. That doesn’t mean volatility is gone - but it may mean investors will need to adjust their playbooks.

• For oil: Watch for further price resilience. If demand holds and supply remains calculated, prices could grind higher, even without OPEC+ theatrics.
  
  
• For gold: The retreat may continue in the short term, but don’t count it out. All it takes is one hawkish Fed comment or geopolitical surprise to light a fire under bullion again.
  
  
• For broader commodities: This may be the start of a phase where strategic supply moves, inventory trends, and real economic data matter more than headlines.

Commodities aren’t screaming anymore - they’re signalling. And those signals suggest a more strategic, less panicked second half of 2025. For traders, this could present both a challenge - and an opportunity.

Oil and Gold technical outlook

At the time of writing, Oil is seeing some drawdown, hovering around the $61.24 level. Price levels are just below a major sell zone, hinting that sellers could maintain control. However, a potential inverse head and shoulders formation is taking shape, hinting at a potential bullish move. The bullish narrative is also buttressed by the volume bars indicating waning sell pressure. 

Should the slump continue, prices could be held at the strong $57.56 support level, which has held prices before. If bulls have their way, prices could encounter resistance walls at the $63.56 and $69.90 resistance levels. 

Gold has seen a significant slump as risk-off sentiment dominates the market. Sell-side bias is evident on the daily chart. However, the volume bars tell a story of sells not yet moving with conviction. This could set the stage for a potential return of buyers. Should we see a collapse, prices could find a support floor at the $2,980 support level. If a bounce materialises though, prices could encounter resistance walls at the $3,250 and $3,435 resistance levels.

Will Oil and Gold see more volatility? You can speculate on the price of Oil and Gold with a Deriv MT5 or Deriv X account.