Commodity Insights

Precious Metals: Gold & Silver – Strong Bullish Momentum Intact

Gold and silver continue to outperform sharply, driven by a combination of geopolitical risks, a weakening U.S. dollar, and expectations of rate cuts. Spot gold has surged to a fresh record near $4,500/oz, up over 70% YTD, reaffirming its role as the preferred safe-haven asset amid global uncertainty and sustained central bank buying. The sharp decline in the dollar—heading for its steepest annual fall since 2017—has further amplified upside momentum.

Silver remains the clear outperformer, hitting an all-time high near $70/oz with a massive 142% YTD gain. Apart from safe-haven demand, silver is also benefiting from its industrial usage, making it more sensitive to reflation and supply constraints. Structurally, the trend for both metals remains strongly bullish, and any corrective dips are likely to attract aggressive buying interest rather than signal trend exhaustion.

Crude Oil: Geopolitical Premium vs Weak Fundamentals

WTI crude oil is trading sideways near $58 per barrel, reflecting a tug-of-war between geopolitical headlines and weak demand fundamentals. Supply concerns linked to U.S. actions on Venezuelan crude and renewed disruptions in the Black Sea region have provided short-term support. However, these risks have not been sufficient to alter the broader supply-demand balance.

Global oil markets continue to face ample supply and sluggish demand growth, and even a material drop in Venezuelan exports is unlikely to tighten balances meaningfully into early 2026. As long as disruptions remain temporary, rallies are expected to fade at higher levels, keeping crude in a range-bound to mildly bearish structure.

Base Metals: Copper Leads on Structural Supply Tightness

Base metals are trading firm, led by zinc, while copper remains close to record highs near $11,970 per tonne. Copper is on track for its strongest annual performance since 2009, driven almost entirely by structural supply constraints rather than speculative demand.

Disruptions at major mines in Chile and Peru, delays in Indonesia, and the absence of new large-scale projects have significantly tightened global concentrate availability. This stress is clearly visible in Chinese smelters agreeing to zero treatment and refining charges for 2026, an unprecedented development that underscores miners’ pricing power. Despite minor profit booking after record highs, copper’s medium-term outlook remains firmly positive.

Natural Gas: Supply Overhang Keeps Pressure Intact

U.S. natural gas prices are hovering near $4.00/mmbtu, supported intermittently by weather uncertainty but capped by overwhelming supply-side pressure. Forecasts of warmer-than-normal temperatures are expected to limit heating demand in the near term, although brief cold spells could create short-lived spikes.

Fundamentals remain decidedly bearish, with production near record highs, rising rig counts, and the EIA revising 2025 output estimates upward. While LNG exports and power generation demand offer some cushion, the broader outlook remains range-bound to slightly negative, with upside risks primarily driven by weather volatility rather than structural improvement.

Chanakya Commodity Takeaway

• Bullish: Gold, Silver (safe-haven + policy + geopolitics)

• Structurally Strong: Copper (supply-driven rally intact)

• Neutral to Bearish: Crude Oil (headline risk vs surplus)

• Bearish Bias: Natural Gas (high supply, weak demand)

Key Insight:

Commodities are increasingly moving on structural narratives, not short-term news. Precious metals and copper remain trend leaders, while energy markets continue to struggle against excess supply.