Week 36 Commodities: Oil Reclaims Geopolitical Premium, Gold Jolted by Jobs Data, Copper Stays Tight
Week 36 reset the commodity landscape from Week 35, yet no single macro cycle has re-emerged. Crude oil regained geopolitical and refined product support after partially giving back premiums the previous week, with Brent and WTI both posting notable weekly gains as US-Iran conflict risks and Hormuz shipping concerns returned to the fore. Gold moved in the opposite direction: hot US nonfarm payrolls lifted rate-hike probabilities and overwhelmed residual safe-haven demand on Friday.
Energy: Geopolitics Drives the Narrative
The re-pricing of Middle East risk was the week’s defining feature in energy markets. With the Strait of Hormuz back in focus, traders added risk premiums to crude, while refined product cracks remained firm. Natural gas also firmed on improved weather-driven demand and LNG feedgas needs, though supply caps continued to limit upside.
Precious Metals: Jobs Data Trumps Safe-Haven Flows
Gold’s pullback underscores its growing sensitivity to real yields and the dollar. The strong employment report reinforced the Federal Reserve’s higher-for-longer stance, pressuring bullion despite lingering geopolitical anxiety. Silver followed suit, while platinum group metals showed mixed performance.
Base Metals: Copper’s Tightness vs. Rate Headwinds
Copper held elevated levels on physical tightness and logistics risks, but the metal continues to wrestle with the interest-rate channel. Market participants are now looking for demand confirmation after the supply-side signals. Aluminum and zinc were rangebound, with LME inventories providing some cushion.
Agriculture: Weather and Export Flows Dominate
Grains, which had closed Week 35 stronger, turned weaker on Friday. The complex remains a weather- and export-driven market, with wheat and corn watching Black Sea shipments and US planting progress. Soybeans stayed sensitive to South American weather forecasts.
Week 37 Outlook: Divergence Persists
The opening of Week 37 shows clear divergence: energy risk is again one of the loudest inflation channels, gold is more responsive to yields and the dollar, copper needs demand confirmation after supply signals, and agriculture remains at the mercy of weather and trade flows. Investors should brace for continued cross-asset volatility as geopolitical and macro forces pull commodities in different directions.
