Commodities Market Summary – July 13, 2026
Commodity markets began the week with a sharp divergence between the energy and precious metals sectors as escalating geopolitical tensions in the Middle East boosted crude oil prices while rising U.S. interest rate expectations pressured gold and silver. The combination of renewed military activity involving Iran, concerns over shipping through the Strait of Hormuz, and growing uncertainty surrounding global energy supplies pushed oil prices sharply higher, while stronger expectations for a Federal Reserve rate hike increased the opportunity cost of holding precious metals.
Within the oil and energy ETF universe, performance was generally constructive. Oil service companies led the sector, with the SPDR S&P Oil & Gas Equipment & Services ETF (XES) gaining 1.6% for the day, followed by the VanEck Oil Services ETF (OIH), which rose 1.5%. Broad energy sector ETFs also posted solid gains, including the iShares Global Energy ETF (IXC) (+0.5%), Energy Select Sector SPDR (XLE) (+0.5%), Fidelity MSCI Energy ETF (FENY) (+0.5%), Vanguard Energy ETF (VDE) (+0.4%), and iShares U.S. Energy ETF (IYE) (+0.5%), reflecting renewed investor interest in integrated oil producers and refiners. Leveraged crude oil exposure remained relatively muted despite higher oil prices, with the ProShares Ultra Bloomberg Crude Oil ETF (UCO) finishing unchanged, while the United States Oil Fund (USO) slipped 0.3%, highlighting that much of the recent geopolitical premium had already been priced into futures markets.
Natural gas ETFs continued to underperform following last week’s sharp decline in Henry Hub prices. The United States Natural Gas Fund (UNG) fell 2.1%, while the leveraged ProShares Ultra Bloomberg Natural Gas ETF (BOIL)dropped 4.2% as traders continued to react to stronger-than-expected storage builds and robust U.S. production. Conversely, the inverse ProShares UltraShort Natural Gas ETF (KOLD) gained 4.3%, extending its strong recent momentum. Despite the recent weakness in natural gas prices, fund flow data suggest investors continue using leveraged products for tactical trading opportunities.
Broader commodity ETFs were mixed. Diversified funds such as the Invesco Optimum Yield Diversified Commodity Strategy ETF (PDBC) and the iShares S&P GSCI Commodity-Indexed Trust (GSG) posted modest declines, reflecting weakness in precious metals despite strength in energy. Meanwhile, actively managed strategies including the First Trust Global Tactical Commodity Strategy Fund (FTGC) and Harbor Commodity All-Weather Strategy ETF (HGER) remained relatively stable and continue to attract meaningful year-to-date investor inflows, indicating institutional investors remain committed to maintaining diversified commodity exposure as an inflation hedge.
The energy complex was the clear outperformer, with WTI crude oil rising 3.3% to $73.81 per barrel and Brent crude climbing 3.3% to $78.52, extending last week’s gains as markets reacted to attacks on U.S. military facilities in the Gulf region, disruptions to commercial shipping near the Strait of Hormuz, and continued attacks on Russian energy infrastructure. Supporting the bullish outlook were reports of declining floating crude inventories, historically strong global refining margins approaching record highs, and signs that China is encouraging refiners to maintain elevated processing rates to safeguard domestic fuel supplies. While natural gas declined 1.6% to $2.89/MMBtu following last week’s sizable storage build, expectations for above-normal temperatures across much of the United States should continue to support seasonal electricity demand heading further into the summer. Investors will also closely monitor this week’s OPEC Monthly Oil Market Report, API and DOE inventory reports, and Baker Hughes rig count for additional direction.
The precious metals sector traded lower as investors reduced safe-haven exposure in response to rising Treasury yields and increasing expectations that the Federal Reserve could raise interest rates as early as September. According to CME FedWatch, markets are now pricing roughly a 71% probability of a September rate hike, up significantly from the previous week. Against that backdrop, gold declined 0.96% to $4,074 per ounce, while silver fell 1.72% to $59.13 per ounce. Despite today’s weakness, both metals remain positive year-to-date, with gold up more than 6% and silver continuing to outperform with gains exceeding 16%. Mining equities also softened, with the VanEck Gold Miners ETF (GDX) and VanEck Junior Gold Miners ETF (GDXJ) both moving lower. Nevertheless, Wall Street remains constructive on the sector over the intermediate term, with Jefferies continuing to favor copper producers and high-quality mining companies over the next several months. Meanwhile, copper bucked the broader metals weakness, rising 0.56%and extending its strong year-to-date performance as long-term demand from electrification, infrastructure investment, and artificial intelligence-related power infrastructure remains supportive.
Final Thoughts
Commodity markets remain increasingly driven by two competing macroeconomic forces. On one hand, escalating geopolitical risks continue to support crude oil prices and could keep energy markets volatile if supply disruptions intensify. On the other hand, rising interest rate expectations and a stronger U.S. dollar are creating near-term headwinds for precious metals despite their favorable long-term fundamentals. As investors look ahead, this week’s inflation data, Federal Reserve expectations, OPEC commentary, and U.S. inventory reports are likely to determine whether energy prices extend their rally or whether precious metals can regain their footing. The current environment continues to favor a diversified commodity allocation, with energy benefiting from geopolitical risk while industrial and precious metals remain well positioned to participate in longer-term structural themes including electrification, artificial intelligence infrastructure, and global resource security.
