Oil to Gold ratio
by John Kemp, 24 February 2008

After an 8-year period of remarkable stability, the ratio between gold and oil prices has broken down spectacularly.

The relative rise in gold is consistent with other indications that the market is bracing for a delayed upturn in inflation between 2010 and 2012.

From 2000 to 2008 one ounce of gold bought between 6 and 15 barrels of light sweet crude oil but for months the markets have been moving in opposite directions. In recent weeks, one ounce of gold has bought as many as 27 barrels of oil