Brent crude is currently around $96.55/bbl, having surged roughly 9.6% over the course of this week alone as fresh US-Iran military exchanges — including strikes on Iran's Qeshm Islands and Iranian attacks on US naval assets — cast doubt on the prospects of a peace deal. Oil pulled back modestly on Thursday, falling ~1.1% to around $96.71, after reports that the White House intends to maintain a ceasefire unless American troops are killed. The near-term outlook is precarious: Trafigura warned that energy markets are at a "critical juncture," with the strategic stockpile buffers that cushioned the initial supply shock now "largely spent." Russian Deputy PM Novak confirmed the market is already facing a structural deficit of approximately 12 million barrels per day, with the full impact not yet felt due to previously accumulated reserves. OPEC+ has not yet discussed increasing quotas to compensate for lost revenues following any eventual Strait of Hormuz reopening. Singapore oil-product stockpiles fell to their lowest level since October 2024, and gasoline is flagged as the next petroleum product at risk of acute supply pressure. Tankers are reportedly gathering outside the Persian Gulf in anticipation of a potential reopening.
Gold is trading at a historically elevated $4,470/oz, supported by geopolitical uncertainty, central bank tightening risks, and persistent inflation from the energy shock. Wealth managers are increasingly treating gold and silver not merely as safe havens but as core strategic allocations. Silver at $73.42/oz is also well-bid, though the spot market leans cautious on a day-to-day basis. On the corporate side, Sunshine Silver Mining priced its IPO at $13.50 per share — the bottom of its $13.50–$16.50 range — raising $270 million, reflecting some investor caution despite elevated silver prices. Elliott Investment Management has built a stake worth over A$1 billion in Australia's largest gold miner Northern Star Resources and is pushing for a strategic review, including a potential sale. Russia issued its first gold-mining estimate in years, claiming 480–500 tons of output for 2026, which would surpass China as the world's top producer.
Copper (LME 3-month) trades at $13,825/t, supported by AI infrastructure and data center demand but facing headwinds from weak Chinese domestic consumption. Chinese aluminum prices are expected to fluctuate in the near term as export demand offsets soft domestic activity. SHFE aluminum and nickel each fell over 1% in Thursday's Asian session as the broader risk-off mood weighed on industrial metals.
The commodity complex is bifurcated between energy — where the supply shock is intensifying and buffers are depleting — and agriculture/metals, where the picture is more mixed. The OECD has cut its 2026 global growth forecast to 2.8% (from 2.9%), warning of a severe slowdown if the Middle East conflict extends into 2027. The key swing factor across all commodity markets remains the trajectory of US-Iran negotiations and the timeline for any Strait of Hormuz reopening. Even in a resolution scenario, energy executives warn that fuel prices would remain elevated for an extended period given the depth of the inventory drawdown.
