,Last month, sanctions on Russia upended the oil market, the world’s biggest commodities trade. Now, Group of Seven (G7) leaders are proposing to repeat the trick with the second-biggest trade, gold. Don’t expect the same reaction.新2查账网址（www.hg108.vip）提供新2网址和新2最新网址,包括新2手机网址,新2备用网址,皇冠最新网址,新2足球网址,皇冠新2网址,新2管理网址,新2网址大全,hg0088.com,hga038.com,同时开放新2信用平台查账功能.
LAST month, sanctions on Russia upended the oil market, the world’s biggest commodities trade.
Now, Group of Seven (G7) leaders are proposing to repeat the trick with the second-biggest trade, gold. Don’t expect the same reaction.
Between European Commission president Ursula von der Leyen first proposing sanctions on crude in early May and the package being introduced a month later, prices for Brent rose about 14%, on top of the 8.4% rise they’d seen since the invasion of Ukraine began in February.
Gold has had a quieter year, down 3.9% since Russian forces rolled across the Ukrainian border.
Despite Moscow’s status as the third-biggest producer of the yellow metal, the import bans set to be announced at the G7 meeting this week in Germany aren’t likely to reverse that bout of weakness.
Losing its shine
Crude has surged since Russia invaded Ukraine. Gold, not so much.
Partly, that’s just a function of market scale. In a normal year, Russia accounts for about 12% of the world’s crude exports.
Almost every barrel that comes to the surface is used within the year, barring movements in the 90 days or so of reserves that major energy importers hold onto.
Gold, because of its price and density, is far easier to stockpile.
You could easily place enough bullion to buy the one million barrels in a typical oil tanker onto a six-seater dining table. As a result, inventories are vast, with mining adding just 3,500 tonnes a year or so to a 205,000 tonnes stockpile.
Roughly a quarter of gold consumption in a typical year comes from selling or melting down jewellery, coins, bars and industrial metals – and those recycling numbers tend to creep up whenever a shortage of mine supplies puts upward pressure on price.
Russia is unquestionably a major player. The 300 tonnes it produced last year was only exceeded by China and Australia, and accounted for a crude-style 10% of the global total.
What counts for global trade isn’t production, however, but net exports – and on that basis Russia is a minnow.
Mine and yours
For all the scale of Russia’s gold production, its exports are smaller than those of some territories that barely mine the metal.
Its cumulative gold trade surplus over the past 10 years comes to US$60.38bil (RM266bil), a smaller sum than the US$60.65bil (RM267bil) that Japan racked up by selling down its private and public holdings of the metal (the country has just a single operating gold mine, which isn’t likely to contribute significantly to this sum).
Similarly, Hong Kong has been a far bigger net exporter of gold than biggest producer China, thanks to its role as a conduit for foreign capital into the mainland.