Gold vs Crude Oil in Singapore: How the Two Assets Compare and How to Invest [2026]

In its October 2026 Oil Market Report, the International Energy Agency (IEA) forecast world oil supply to fall by 5.8 million barrels a day this year, to 100.7 mb/d, as the Iran war and the loss of Hormuz crude flows cut exports from the Gulf. Brent crude futures had climbed 13% since the start of September to around US$107 a barrel. Gold, meanwhile, set its London benchmark at US$4,048.25 an ounce on 23 October 2026.

Both are commodities, but they do different jobs. Gold is a monetary metal: most of what has ever been mined still exists, and buyers hold it as a reserve asset. Central banks alone bought a net 288.9 tonnes in the second quarter of 2026, up 62% on a year earlier. Crude oil is an energy input that gets burned, so its price depends on how much the world is producing and consuming this month.

That difference carries through to the way investors hold each one. A gold ETF can keep metal in a vault, while an oil fund buys futures contracts and has to replace them every month. The roll can push an oil fund's return away from the spot price of crude, sometimes by a wide margin over a year.

Investors in Singapore can hold gold as bullion, through a bank gold account or through a physically backed ETF such as GLDM. Oil exposure usually comes through futures-based funds such as USO, which tracks WTI, and BNO, which tracks Brent, or through shares of energy companies.

This guide explains how gold and oil differ, why their prices sometimes move together, what the gold-to-oil ratio measures, how gold and oil ETFs are built, how contango and backwardation affect oil fund returns, and how each asset can fit in a portfolio.

Gold vs crude oil at a glance

The two assets answer to different forces, and they are stored, priced and held in funds in different ways.

Gold and crude oil compared by use, supply response, storage and fund structure

Source: SSGA GLDM, USCF USO, USCF BNO, IEA Oil Market Report (as of 25 October 2026)

How gold and oil differ as assets

Gold behaves like a stock of value. Bars mined centuries ago can still be melted down and sold, so the supply available to the market is the whole above-ground pile, and a year of mine output adds only a small slice to it. Prices move mostly on whether holders want more of that pile or less.

Oil behaves like a flow. A barrel gets refined and burned within weeks or months of leaving the ground, so the market has to clear production against consumption all the time. A shortfall of a few million barrels a day, small against world consumption of around 100 mb/d, can move prices sharply because there is little spare stock to fall back on.

Storage reinforces the gap. A tonne of gold fits in a small vault and costs little to insure next to its value. A million barrels needs a tank farm or a supertanker, and the cost of storing oil feeds straight into the shape of the futures curve.

Why gold and oil prices sometimes move together

Gold and oil can rise together or split apart for years, depending on which force dominates the market.

Inflation expectations

When investors expect higher inflation, both assets can benefit. Expensive oil raises transport and production costs across the economy and lifts inflation directly. Gold tends to attract buyers who want an asset outside the banking system that cannot be printed. In an energy-led inflation scare, oil is often the cause and gold the response.

Growth and recession

Growth pulls the two apart. Oil demand depends on factories, freight and travel, so a recession usually cuts consumption and prices. Gold has little industrial demand to lose, and falling interest rates in a downturn reduce the cost of holding an asset that pays no income.

Interest rates and the US dollar

Both are priced in US dollars, so a weaker dollar tends to lift their prices for buyers using other currencies. Real interest rates matter more for gold than for oil. When inflation-adjusted bond yields fall, the income given up by holding gold shrinks, and gold has historically tended to do better.

Supply shocks

Oil supply shocks come from conflict, sanctions, pipeline damage and producer decisions. Gold supply shocks are rare because mine output is small next to existing stocks. A war in an oil-producing region can lift both at once: oil because barrels go missing, and gold because investors and central banks look for safety.

The 2026 oil backdrop

Disruption in the Gulf has shaped the 2026 oil market, with supply lost to the Iran war, renewed attacks in the region and the 11 September bombing of the Saudi East-West Pipeline. The IEA forecasts global oil demand to fall by 2.6 mb/d on average in 2026 and recover by 2 mb/d in 2027, with high prices and a weaker economy weighing on consumption.

Stocks have been drawn down to cover the gap. Global observed inventories were 509 million barrels lower than at the end of February, and backwardation was steepening in diesel and gasoil markets, a sign that buyers were paying up for prompt supply. The IEA expects supply to rise by 7.7 mb/d in 2027 if flows recover.

What is the gold-to-oil ratio?

The gold-to-oil ratio measures how many barrels of crude one troy ounce of gold can buy. The formula is the gold price in US dollars per ounce divided by the oil price in US dollars per barrel, and the answer is in barrels per ounce.

Taking the LBMA gold price of US$4,048.25 on 23 October 2026 and Brent futures at around US$107 a barrel in mid-October, one ounce bought about 37.8 barrels. The two prices come from different days, so the figure only illustrates the method.

Gold-to-oil ratio scenario grid

The ratio moves with both prices, and a sharp fall in oil can make it jump even when gold is flat.

Gold-to-oil ratio grid for gold at US$2,500 to US$4,000 and oil at US$50 to US$100

Example only. Assumes the gold and oil prices shown; ratio equals gold price divided by oil price.

How to read highs and lows

A high ratio means oil is cheap in gold terms, and it usually appears when oil demand has collapsed, as in a recession. A low ratio means oil is expensive in gold terms, which tends to happen during supply shocks. Because oil is the smaller and more volatile number, most big swings in the ratio come from the denominator.

Some traders watch the ratio for signs that one asset has moved too far, but it has no fixed fair value and can sit at extreme levels for long stretches when the structure of the oil market changes. It describes the relative price of the two better than it times trades.

How a gold ETF holds gold

A physically backed gold ETF is usually a trust that owns bullion. GLDM, the SPDR Gold MiniShares, is a series of the World Gold Trust, with JPMorgan Chase Bank as gold custodian and a 0.10% gross expense ratio. It lists on NYSE Arca, its ISIN is US98149E3036, and it held US$30,301.72 million in net assets on 23 October 2026.

The share value tracks the value of the gold held by the trust, less expenses. GLDM generates no income: it sells small amounts of gold to pay its fees, so the gold behind each share declines slowly over time. A 0.10% fee means that every year, roughly one-thousandth of the metal goes to running costs.

The fund holds the metal itself, so no contracts need replacing, and its price follows the LBMA benchmark closely apart from fees. GLDM is also a trust outside the 1940 Act rules that govern US mutual funds, and its investors own a share of a pool of gold.

How oil ETFs hold oil: futures and the roll

Oil funds cannot keep crude in a vault, so they buy futures contracts, which are agreements to buy oil at a set price on a future date. USO aims for its daily NAV changes to track the NYMEX futures contract for light sweet crude delivered to Cushing, Oklahoma, better known as WTI. BNO tracks the near-month Brent crude futures contract on ICE Futures.

Both funds are limited partnerships and commodity pools regulated by the US Commodity Futures Trading Commission. The cash they hold as collateral sits in short-term US government debt and cash equivalents, and the interest it earns forms part of the return.

Futures expire, so the fund has to sell the contract that is about to expire and buy the next one. USO spreads this roll across five days at the start of each month. BNO switches its benchmark to the next contract when the near month is within two weeks of expiry.

Contango and backwardation

The roll costs or earns money depending on the shape of the futures curve. In contango, later contracts cost more than the spot price, often because storage is full and holders want paying to keep oil. In backwardation, later contracts cost less than spot, which tends to happen when inventories are tight and buyers want oil now.

Say spot oil stays at US$80 for a full year, and each month the fund buys the next contract 1% above or below spot. As that contract converges back to US$80 at expiry, the fund gains or loses about 1% a month.

Example only. Assumes spot oil fixed at US$80, a 1% curve slope every month, monthly rolls, and no fees or collateral interest.

The spot price never moved, yet the fund in contango lost more than a tenth of its value. Real curves change shape constantly, and steep contango in a glutted market can do far more damage. When supply is tight, as in diesel markets in October 2026, backwardation can add to returns instead.

Value of US$10,000 in a rolling oil futures fund over 12 months in contango, a flat curve and backwardation

Why USO and spot crude differ

The roll yield from contango or backwardation is usually the biggest gap between an oil fund's return and the headline oil price. Collateral interest adds a little, and fees take a little. WTI and Brent also trade at different prices because they are different grades delivered to different places, so USO and BNO can diverge from each other as well as from the oil price quoted in the news.

Gold and oil fund structures compared

Physical gold, a gold trust and an oil futures fund look similar on a broker screen, but they hold very different things.

Source: SSGA GLDM, USCF USO, USCF BNO (as of 25 October 2026)

Energy company shares are another route to oil exposure. Producers' profits rise with the oil price, but their shares also reflect costs, debt, dividends and the wider stock market, so they behave partly like equities.

Gold and oil under four macro scenarios

Each scenario tends to work through a familiar mechanism.

Example only. Assumes each scenario in isolation; real markets combine several forces at once.

The 2026 market looks most like the third row: a supply shock that lifts oil, against a backdrop where central bank demand has kept gold well bid. A recession would likely hit oil harder than gold.

Costs, FX and tax for Singapore investors

Gold and oil are priced in US dollars, so a Singapore investor carries currency risk on top of the commodity price. If the Singapore dollar strengthens against the US dollar, returns measured in SGD shrink even when the commodity price is unchanged.

Fees vary by structure. GLDM's 0.10% expense ratio is low for a commodity fund, while futures funds also carry the hidden cost or benefit of the roll. Broker commissions, FX conversion spreads and bid-ask spreads come on top.

On tax, Singapore generally does not tax individuals on gains from selling shares and financial instruments held as investments, though frequent trading for profit can be treated as income. Neither GLDM nor the oil funds pay regular dividends, so the 30% default US withholding on US-source dividends for nonresident aliens has little bite here. US-domiciled funds can count as US-situated assets for estate tax, and executors must file Form 706-NA when US-situated assets exceed US$60,000. Partnerships such as USO and BNO also have their own tax reporting, set out on each fund's tax information page. None of this is tax advice.

Buying any of these funds needs a broker with US market access, a completed W-8BEN form and US dollars to settle the trade, as with any other US-listed ETF.

Where gold and oil can fit in a portfolio

Gold usually earns a place as a long-term diversifier. It pays no income, but it has tended to hold value in periods when shares and bonds struggle together, and a small strategic allocation needs little upkeep. Size any commodity position so that a large swing in its price would not derail your plan.

Oil is harder to hold for the long run through futures funds. Roll costs in contango can erode returns year after year, and the price swings with every change in supply and demand. Most investors who use oil funds treat them as tactical positions with a defined view and time frame, or get energy exposure through broad equity funds that already include oil producers.

Invest in gold with StashAway ETF Explorer

If gold is the one you want to hold for the long run, ETF Explorer lets you buy SPDR Gold MiniShares (GLDM), a physically backed gold ETF, from its Gold page. Each buy or sell order costs US$1 (excluding GST), with no management fee on top, and you can pay with cash or SRS.

If you would rather not pick funds yourself, General Investing powered by StashAway gives you a managed, globally diversified ETF portfolio instead.

Gold prices can swing sharply, so you could get back less than you invest.

Frequently asked questions

Here are short answers to the questions investors ask most when comparing gold and oil.

What does the gold-to-oil ratio mean?

It is the number of barrels of crude oil one ounce of gold can buy, found by dividing the gold price per ounce by the oil price per barrel. Using gold at about US$4,048 and Brent around US$107 in October 2026, the ratio was close to 38 barrels.

Why can oil fall while gold rises?

Their main drivers differ. A recession cuts fuel demand and pushes oil down, while lower interest rates and safe-haven buying can support gold at the same time.

Is USO the same as owning crude oil?

No. USO holds WTI futures contracts and rolls them every month, so its return includes roll gains or losses and collateral interest. Over a year in contango, it can lag spot crude by a wide margin even if the oil price ends where it started.

How do I buy gold or oil ETFs in Singapore?

You need a broker or platform with access to US-listed funds, plus a W-8BEN form on file. GLDM, USO and BNO all trade on NYSE Arca in US dollars, so factor in the FX conversion cost along with the commission.

Which is the better inflation hedge, gold or oil?

Oil often rises at the start of an inflation spike because it is frequently the cause, but it falls hard when growth slows. Gold has a longer record as a store of value across cycles, though its price can still drop for years at a time.

Does GLDM pay dividends?

No, GLDM pays no income. The trust sells a small amount of gold to cover its 0.10% expense ratio, so the metal behind each share edges down slowly over time.