* Gold up as oil soars on escalating clashes in Libya
* Rise in US nonfarm payrolls supports gold
* Silver rides gold's coattails to 31-year high
* Coming up: CFTC positions data, 3:30 p.m. EST Friday
(Recasts, adds comments, updates prices, adds second
byline/dateline)
By Frank Tang and Jan Harvey
NEW YORK/LONDON, March 4 (Reuters) - Gold rose above $1,430
an ounce on Friday, while silver surged 3 percent to 31-year
highs, as soaring oil prices fueled by widening unrest in Libya
prompted investors to pile into safe havens.
Bullion hit a record high of $1,440.10 an ounce on
Wednesday and is on track to post its fifth consecutive weekly
gain on fears that Libya's escalating violence could spread
across the Arab world.
World stocks and the dollar declined as upbeat U.S. jobs
data was offset by mounting economic uncertainty. []
"It's really all about oil, and I suspect that's going to
be the pattern next week as well. Gold's uncertainty hedge and
ultimate currency roles continue to be very much in place,"
said Bill O'Neill, partner of LOGIC Advisors.
U.S. crude prices jumped to their highest levels since
September 2008 and Brent rose above $116 a barrel as Libyan
security forces cracked down on protesters in Tripoli and
clashed with rebels near the major oil terminal of Ras Lanuf.
The Reuters/Jefferies CRB commodities index <.CRB>, which
is heavily weighted in oil, was set to notch its best gains in
13 weeks.
Spot gold <XAU=> hit a high of $1,431.85 an ounce and was
up 1.1 percent at $1,430.70 by 12:13 p.m. EST (1713 GMT). Gold
fixed at $1,427 in London. U.S. gold futures for April delivery
<GCJ1> rose $15.80 to $1,432.20.
Gains in gold also lifted silver prices, which climbed to
their highest since early 1980 at $35.32 an ounce.
Spot silver <XAG=> gained 3.3 percent to $35.13 an ounce.
The gold-silver ratio, which shows how many ounces of
silver it takes to buy one ounce of gold, fell to a 13-year
low.
Silver has risen amid a tight physical market and very
strong demand for industrial metals as the economy recovers.
"Ultimately, the reasons why silver is going up are related
to gold," O'Neill said. "Make no mistake, if gold reverses
direction and starts to go to a bear market, silver will follow
with a vengeance."
Gold gains accelerated after news that U.S. nonfarm
payrolls increased by 192,000 in February, above market
expectations for 185,000 jobs. []
While the numbers beat Reuters forecasts, many in the
market had privately expected a still stronger number, leading
to initial weakness in equities and the dollar. [] []
"The economy is improving, growth could surprise on the
upside, but the economic recovery is not producing new jobs as
it has in the past, given those growth rates," said Peter
Fertig, a consultant at Quantitative Commodity Research.
There is no indication from the jobs data that the Fed
could terminate quantitative easing earlier than scheduled,
which is going to underpin gold's investment appeal, Fertig
said.
The Fed's easy monetary policy, in place since the
financial crisis rocked the markets from 2008, has been a major
reason for gold's rally to record highs, because it has
undermined confidence in paper currencies.
Comments from the European Central Bank on Thursday that
stoked expectations that euro zone monetary policy would
tighten sooner rather than later had knocked gold sharply
lower.
VIOLENCE FLARES
Gold prices hit record highs this week as violence flared
in Libya after weeks of unrest in the region.
But interest in investment products such as gold-backed
exchange-traded funds slackened. Holdings of the world's
largest, New York's SPDR Gold Trust <GLD>, fell to their lowest
since mid-May on Thursday at 1,210.621 tonnes. []
Holdings in the world's largest silver ETF, the iShares
Silver Trust <SLV>, rose to 10,794.89 tonnes by March 3, their
highest since early January. []
Among other precious metals, platinum <XPT=> gained 0.5
percent to $1,832.24 an ounce and palladium <XPD=> eased 0.7
percent to $805.97.
Prices at 12:15 p.m. EST (1715 GMT)
LAST NET PCT YTD
CHG CHG CHG
US gold <GCJ1> 1431.80 15.40 1.1% 0.7%
US silver <SIK1> 35.330 1.003 2.9% 14.2%
US platinum <PLJ1> 1837.10 4.10 0.2% 3.3%
US palladium <PAM1> 809.20 -5.60 -0.7% 0.7%
Gold <XAU=> 1431.10 15.51 1.1% 0.8%
Silver <XAG=> 35.32 1.15 3.4% 14.5%
Platinum <XPT=> 1832.24 8.75 0.5% 3.7%
Palladium <XPD=> 805.97 -6.03 -0.7% 0.8%
Gold Fix <XAUFIX=> 1427.00 9.00 0.6% 1.2%
Silver Fix <XAGFIX=> 34.43 -10.00 -0.3% 12.4%
Platinum Fix <XPTFIX=> 1828.00 3.00 0.2% 5.6%
Palladium Fix <XPDFIX=> 811.00 0.00 0.0% 2.5%
(Additional reporting by Jan Harvey in London; editing by Jim
Marshall)
