Gold shed another leg as rising bond yields and a stronger dollar erased the safe-haven bid, copper pulled back from its COMEX record to US$12,000 per tonne, and the Hormuz oil shock quietly crossed a milestone markets have been slow to price - cumulative output losses closing in on one billion barrels.
Energy and base metals kept absorbing the Gulf conflict's fallout, with the Strait closure holding more than 10 million barrels pre day (mb/d) offline and freight rerouting reshaping supply chains into the crisis's third month.
Gold - which ran on geopolitical fear through Q1 - got undercut by the very inflation it helped create, a reversal that has wrong-footed the speculative long books built through February and March.
ANZ Research's Daniel Hynes and Soni Kumari, in their weekly Commodity Exchange note: gold's inverse rate correlation has strengthened materially since Gulf hostilities escalated in late February.
With the 10-year Treasury yield now at 4.585%, institutional desk unwinds have emerged as the dominant near-term price driver, overwhelming the geopolitical bid that carried the metal through Q1.
China's April industrial output, retail sales, and property prices landed on Monday - the first comprehensive read on how the Hormuz shock has filtered through the world's largest commodity consumer.
Wednesday is the week's macro pivot, with FOMC minutes and the IEA's Global EV Outlook both landing on the same session, the latter carrying direct read-through for copper and aluminium fundamentals at exactly the moment the Gulf conflict is stress-testing both metals.
Gold
Gold was trading below $4,550 per ounce (oz) on Monday after tumbling nearly 4% last week, caught between a long-run safe-haven thesis and a macro backdrop giving the Federal Reserve no plausible reason to ease.
ANZ Research's three-stage gold framework opens with an inflation shock headwind as oil curtailments push through to consumer prices, before growth decelerates and a policy pivot toward accommodation ultimately lifts bullion.
ANZ puts $4,500/oz as the near-term floor, treating any further softness as a re-entry window for longer-dated buyers accumulating below the cycle's inflation headwind.
Central bank purchases held at 813 tonnes (t) in 2025, with no institutional evidence of a secular retreat from gold as a portfolio diversifier or reserve asset.
Twelve-month inflation expectations sitting at 3.8% have reinforced the Fed's data-dependent posture through September, prompting ANZ to defer its $6,000/oz target to mid-2027 while trimming the year-end call to $5,600/oz.
Silver tracks gold through the geopolitical cycle but is unlikely to outperform - its industrial exposure tilts the metal toward growth-deceleration risk rather than the haven premium driving bullion.
Price: US$4,537/oz (gold); ~US$76.50/oz (silver)
Crude oil
Persian Gulf output losses have accumulated toward one billion barrels since the Strait closed, a tally now large enough to test the market's well-worn habit of discounting geopolitical tail risk.
ANZ Research estimates a 200-million-barrel stockpile draw in April alone - on track for the largest quarterly drawdown on record in Q2 2026 - with Arabian Peninsula infrastructure damage pointing to a fractured output recovery extending well into 2027.
ANZ expects Brent to hold above $90/bbl through 2026 before retreating to an $80-85/bbl range in 2027, broadly consistent with Westpac's revised Q2 target of $110/bbl fading to $87/bbl by year-end as demand attrition registers.
OPEC+ still matters as a price-signalling mechanism but is hemmed in by geopolitical fractures and flagging internal cohesion, with the UAE's exit formalising that shift without adding any meaningful supply increment.
The World Bank's May Commodity Markets Outlook marks energy prices 24% higher in 2026 - the steepest annual advance since Russia's Ukraine invasion - with the broader commodity index up 16% on surging energy and fertiliser costs.
Price: Brent ~US$102/bbl; WTI ~US$101.50/bbl
LNG
Qatar's Ras Laffan facility remains offline, European storage has drained below 30% against a 50% seasonal norm, and Asian utilities are now bidding directly against European counterparts for the same pool of U.S. export cargoes.
Hormuz-routed volumes have historically supplied 80-90% of Japanese, Korean, and Chinese utility offtake - buyers that have no Atlantic-basin alternative at comparable scale and no short-term flexibility to absorb the curtailment.
Sub-30% European storage means the injection season will require abnormally heavy LNG imports to reach any credible pre-winter target, keeping a structural floor under the TTF benchmark regardless of near-term industrial demand softness.
Demand for U.S. LNG from both Europe and Asia is climbing through H2 2026, pulling domestic Henry Hub availability tighter as export facility utilisation approaches record levels and pressures the domestic market from the back door.
Price: JKM ~US$16.02/MMBtu; TTF ~US$14.80/MMBtu
Copper
Copper has retreated to $12,000/t from last week's COMEX record of $6.58 per pound, with LME inventory builds and fading U.S. front-loading eroding near-term momentum.
The underlying supply picture has not materially improved to justify that pullback, with mine production constraints and concentrate tightness remaining broadly unchanged.
ANZ Research projects mine output growth of just 1% in 2026 as major operations navigate outages on conservative guidance, while smelting capacity expands at 4-5% - widening a gap that keeps concentrate margins chronically thin.
Electrification offtake and data-centre construction should hold the refined copper market 4-5% undersupplied through the year, even as uneven inventory distribution and Gulf shipping disruption add volatility to physical delivery timelines.
A sulphuric acid crunch is compounding the concentrate squeeze - roughly half of global sulphur trade routes through the Middle East - leaving Chile's heap-leach and anode refiners below capacity, as the Westpac May commodities update details.
Price: LME ~US$12,000/t; COMEX ~US$6.58/lb
Aluminium
Aluminium carries the sharpest direct exposure to the Gulf conflict, with the region accounting for 9% of global primary smelting capacity and 18% of world ex-China consumption - a geographic concentration with no quick workaround.
ANZ Research's aluminium call puts 4-5mt of annual exports at immediate risk, and unlike the 2022 European energy crisis, no alternative production base large enough to cover that shortfall exists in the current market.
China's 45mt output cap neutralises the only smelting complex large enough to theoretically fill the gap, while U.S. tariffs and Europe's carbon border adjustment tax stack additional friction onto what remains of traded volumes.
ANZ's Q3 2026 forecast of $3,600/t likely marks the cycle peak, with elevated prices and regional premiums already curbing consumption - and any further acceleration expected to trigger rationing before idled capacity elsewhere can be reactivated.
Price: ~US$3,562/t
Nickel
Nickel has settled near $17,000/t, but a sulphur-driven cost shift is quietly squeezing Class 1 and nickel sulphate economics in ways the headline price has yet to fully absorb.
The Gulf handles roughly half of global sulphur trade and around 75% of Indonesia's granular sulphur intake, positioning the region as a critical input chokepoint for battery-metal processing.
That leaves Indonesia's HPAL facilities - the main pipeline for battery-grade nickel growth - under direct feedstock pressure as the Hormuz curtailment extends into its third month.
Manila's declaration of a year-long national energy emergency adds a second feedstock constraint for Chinese and Indonesian smelters and refiners that depend on Philippine nickel ore for a material share of their intake.
Jakarta continues floating output curbs to shore up pricing, but with Indonesian HPAL expansion proceeding regardless, the signal carries limited conviction against LME nickel stockpiles that remain elevated and broadly distributed across global warehouses.
Price: ~US$17,000/t
Iron ore
Chinese port stockpiles hit a record 167mt across January and February as steelmaker appetite stayed chronically weak, with the property sector's contraction stripping out the demand anchor that historically set a floor under seaborne ore pricing.
Crude steel output fell 3.6% year-on-year to 160mt in the first two months of 2026, with infrastructure and consumer-sector stimulus covering only a fraction of the property-driven shortfall.
Rising anti-dumping measures from trading partners threaten to cap the export volumes that previously absorbed China's domestic oversupply, removing one of the few remaining demand buffers from the pricing equation.
Guinea's Simandou is expected to add ~15mt of seaborne supply in 2026 alongside incremental Brazilian growth, a combination pointing toward a widening market surplus through 2027 even as Simandou's gradual ramp-up offers short-term price support near $100/t.
ANZ sees iron ore fading toward $90/t by year-end as the surplus builds and Chinese steel consumption grinds lower, with any temporary lift from Gulf-driven external demand insufficient to reverse the underlying downward arc.
Price: ~US$100-105/t
Carbon
European carbon allowances hold a constructive medium-term bias under a tightening Fit for 55 cap and expanding coverage to the shipping sector, with European Parliament ETS debates pencilled in for Wednesday.
Near-term trading is being pinched by anaemic industrial output and residual reform uncertainty, creating a gap between the scheme's directional logic and its current price momentum, with ANZ Research forecasting EUAs push toward EUR85/t through 2026.
ACCU demand is expected to hold through tightening Safeguard Mechanism baselines and government ERF procurement, though issuance has been lumpy amid method reforms and integrity scrutiny, keeping prices in an A$35-40/t consolidation band.
Price: EUAs ~EUR75/t; ACCUs ~A$37/t
What to watch:
- Monday: China April industrial production, retail sales, property prices, fixed asset investment
- Tuesday: RBA minutes (Sydney); API weekly U.S. oil inventories; WTI June futures expiry
- Wednesday: FOMC minutes (14:00 NY); IEA Global EV Outlook 2026 (01:00 NY); EIA weekly oil inventories (10:30 NY)
- Thursday: Eurozone S&P Global PMIs; EIA weekly natural gas inventories; Australia unemployment
- Friday: Baker Hughes rig count; CFTC commitment of traders; ICE Europe commitment of traders; Shanghai exchange weekly inventory data
