Commodity outlook đź•— Last Update: 11 March 2026, 8.30 PM
by Riteshkumar Sahu (riteshkumar.sahu@kotak.com), Saait Sawant Dessai
Gold & Silver
Gold remained steady below $5,200 per ounce, while silver slipped more than 1% toward $87, as strengthening of the U.S. dollar above the 99 level weighed on precious metals. Investors remained cautious amid escalating geopolitical tensions in the Middle East and speculation that the International Energy Agency (IEA) could consider the largest-ever coordinated release of strategic oil reserves to stabilize energy markets.
Despite gaining nearly 20% so far this year, gold has struggled to extend its rally since the outbreak of the US–Israel–Iran conflict in late February. Initial war-driven strength in the dollar and forced liquidation by investors covering margin calls in equity markets limited upside momentum. At the same time, extreme volatility in energy prices has revived inflation concerns, prompting markets to reduce expectations of near-term Federal Reserve rate cuts.
However, strong physical demand from Asia continues to provide support to bullion prices. With geopolitical risks still unresolved and inflation concerns lingering, gold’s near-term direction will largely depend on upcoming U.S. inflation data and signals from the Federal Reserve, keeping the metal sensitive to both macroeconomic developments and geopolitical events.
Crude Oil
WTI crude futures rebounded sharply, trading nearly 6% higher around $89 per barrel, after plunging roughly 12% in the previous session. The recovery reflects traders reassessing the geopolitical risk premium tied to the ongoing Iran conflict and the uncertainty surrounding the duration and scale of hostilities.
U.S. Defense Secretary Pete Hegseth warned that the coming phase of operations could represent the “most intense day of strikes,” intensifying concerns about potential supply disruptions in the region. At present, supply risks remain elevated as major Middle Eastern producers have collectively curtailed more than 6 million barrels per day, while tanker movement through the Strait of Hormuz continues to face severe restrictions.
Earlier attempts to cool oil prices after reports that the IEA may release strategic reserves quickly faded, as the G7 offered only conditional support without any concrete decision. With OPEC’s monthly report expected shortly, crude markets remain extremely sensitive to supply developments. Until shipping routes normalize and geopolitical tensions ease, risk premium is likely to remain embedded in crude prices.
Base Metals
Base metals are trading on a mixed note, with aluminium holding relatively firm while most other metals drift lower. Copper remains the weakest performer, hovering near $12,970 per tonne after a three-session rally fueled by opportunistic dip-buying from Chinese fabricators.
Demand signals from China continue to remain supportive, as rising spot premiums indicate that the earlier price correction encouraged downstream procurement from the construction and renewable energy sectors. However, structural supply constraints remain evident in the copper market.
Industry projections indicate that annual smelting refining charges may fall to zero by 2026, highlighting a severe shortage of copper concentrate, which could restrict refined supply and tighten the global market further.
Meanwhile, aluminium prices remain supported by supply disruptions in the Middle East. The ongoing conflict has curtailed production and disrupted shipments through the Strait of Hormuz, a crucial trade route for producers accounting for roughly 9% of global aluminium output.
Natural Gas
U.S. natural gas futures hovered near $3 per MMBtu, holding most of the losses recorded earlier in the week after the IEA proposed a record strategic oil reserve release, potentially exceeding the 182-million-barrel deployment during the Russia–Ukraine conflict in 2022.
Despite concerns over supply disruptions — including an offline LNG export terminal and the continued closure of the Strait of Hormuz shipping corridor — domestic gas prices have remained relatively stable due to strong U.S. production levels and LNG export facilities operating near full capacity.
However, warmer-than-normal weather forecasts through late March are expected to reduce heating demand across major consuming regions. As a result, near-term price risks for natural gas remain tilted to the downside unless weather patterns change or export disruptions intensify.
Bullion & Crude analysis by Kaynat Chainwala, AVP Commodity Research, Kotak Securities:
Spot gold climbed above $5,190/oz today, while silver gained about 3% to around $90/oz, as traders eye geopolitical developments following comments from Trump suggesting the Gulf conflict could end soon, which could ease inflation expectations, particularly after the recent sharp decline in oil prices. Yesterday, gold rebounded strongly from $5,010/oz, eventually settling near $5,140/oz, as easing concerns surrounding the conflict involving Iran weakened the U.S. dollar and supported bullion prices. Silver also posted solid gains, rising about 3% after recovering from an intraday low of $79.6 to close to $87/oz. The dollar had initially strengthened after WTI crude oil briefly surged toward $119 per barrel, a move seen as potentially inflationary and supportive of a more hawkish policy stance from the Federal Reserve. However, the sharp pullback in crude prices later in the session helped precious metals rebound from their earlier lows. Gold was also supported by continued central bank demand, with the People’s Bank of China extending its gold reserve purchases for a sixteenth consecutive month in February.
WTI crude oil fell to around $84.4 per barrel today as Trump indicated that the war with Iran may end “very soon,” easing fears of prolonged supply disruptions. He also signaled plans to waive oil-related sanctions and deploy the U.S. Navy to escort tankers through the Strait of Hormuz, while warning Iran with “death, fire, and fury” if it interferes with shipping in the key transit route. Oil markets have been highly volatile since tensions escalated in the U.S.–Israel confrontation with Iran on February 28, prompting several Gulf producers to reduce output following drone attacks. The United Arab Emirates, Kuwait, and Saudi Arabia joined Iraq this week in cutting production amid tanker traffic disruptions along the Strait of Hormuz, briefly pushing oil prices to $119.5 per barrel on Monday. Despite the sharp spike, prices later pared most of the gains and settled 5% higher at $94.8 per barrel, still the highest closing level since August 2022, after G7 finance ministers signaled their readiness to release strategic petroleum reserves if necessary, although they decided to hold off the release of oil from their respective strategic reserves, for now.
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