Commodity markets remain in focus as investors continue to balance geopolitical developments, supply disruptions, and upcoming U.S. inflation data. Energy markets are digesting recent volatility surrounding the Strait of Hormuz, while metals are benefiting from renewed safe-haven demand and improving sentiment toward industrial commodities. Investors will closely watch this week’s CPI and PPI reports, which could influence expectations for Federal Reserve policy and broader commodity price trends.
Oil & Gas
The energy sector continued to build on Monday’s strong rally, although price action moderated in pre-market trading. WTI crude traded modestly higher at $82.23 per barrel, while Brent crude eased slightly to $87.67. Natural gas pulled back 1.3% to $2.758 after posting its largest one-day gain in two months, as traders locked in profits despite expectations for stronger weather-driven demand and improving LNG export flows. Geopolitical headlines remained the primary catalyst, with markets monitoring negotiations involving Iran and Oman, ongoing attacks on Russian refining infrastructure, continued disruptions in the Red Sea, and reduced tanker traffic through the Strait of Hormuz. These developments continue to support elevated energy risk premiums.
Energy-related ETFs reflected the sector’s recent strength. The United States Oil Fund (USO) gained 6.7% over the past day and is now up 15.8% over the past month, while the SPDR S&P Oil & Gas Exploration & Production ETF (XOP) advanced 5.7% on the day and nearly 11.0% over the last month. The VanEck Oil Services ETF (OIH) rose 5.9%, supported by improving drilling and services activity, and the Energy Select Sector SPDR (XLE) climbed 4.7%. Leveraged products amplified those gains, with the ProShares Ultra Bloomberg Crude Oil ETF (UCO) surging 11.4%, while the inverse SCO declined 10.9% as crude prices advanced.
Metals & Mining
Metals markets remained constructive, led by strength in precious metals as gold continued to attract safe-haven demand while copper benefited from expectations of tighter global supplies. Gold traded 0.6% higher to $4,445.60 per ounce, silver added 0.2% to $65.40, and copper climbed 1.1% to $6.69 per pound. Investor sentiment was also supported by news that Chile will reinvest all of Codelco’s profits into expanding production, while Australia and Vietnam announced deeper strategic cooperation across several industries, including mining and critical minerals. Market participants are also monitoring U.S. inflation data later this week for clues on future interest rate policy.
ETF performance reflected the constructive backdrop across both precious and industrial metals. The SPDR Gold Shares (GLD) gained 1.0%, while the iShares Silver Trust (SLV) advanced 3.3%. Precious metals miners continued their strong momentum, with the VanEck Gold Miners ETF (GDX) up 0.7% and the VanEck Junior Gold Miners ETF (GDXJ) rising 1.0%, both posting gains of roughly 20% over the past month. Industrial metals also remained firm, with the Global X Copper Miners ETF (COPX) advancing 1.7% on the day and nearly 17% over the past month, while the SPDR Metals & Mining ETF (XME) rose 1.6%.
Commodity markets continue to be driven by a combination of geopolitical risks, supply constraints, and macroeconomic expectations. Energy prices remain highly sensitive to developments in the Middle East and global shipping routes, while precious metals continue to benefit from safe-haven demand ahead of key U.S. inflation reports. Industrial metals also remain well supported by supply concerns and expectations for long-term infrastructure and electrification demand. Investors should expect elevated volatility in the days ahead as markets digest economic data and evolving geopolitical headlines.
