Chanakya Commodity Outlook

Gold & Silver

Gold stayed muted on Thursday as traders booked profits after the metal hit a two-week high in the previous session. Spot Gold hovered near $4,150/oz, consolidating as the market weighs the probability of a December U.S. rate cut amid mixed signals from Federal Reserve officials.
Spot Silver traded firm, gaining 0.6% to around $53.60/oz. Conflicting remarks from Fed policymakers have lifted hedging interest in short-term rate derivatives, keeping uncertainty high. Expectations of a softer policy stance have risen further as Kevin Hassett — considered aligned with President Trump’s dovish preferences — moves ahead as the frontrunner for the next Fed Chair.
Overall, precious metals remain highly sensitive to movements in U.S. rate expectations, the dollar, and broader risk sentiment.

Crude Oil

Crude prices held steady as traders monitored geopolitical signals ahead of U.S.-led peace talks aimed at addressing the Russia-Ukraine conflict. News of a U.S. envoy’s planned visit to Moscow triggered speculation about the pace of possible sanctions relief on Russian oil, though expectations remain restrained.
The market remained cautious even after U.S. EIA data showed commercial crude inventories rising by 2.8 million barrels, highlighting oversupply concerns. With crude heading for a fourth straight monthly decline, attention is firmly on this weekend’s OPEC+ meeting, where clarity on supply management will determine near-term direction.

Base Metals

Base metals traded soft through the session, led by declines in zinc and aluminium, while copper slipped about 0.5%. However, the medium-term outlook for copper stays constructive.
Codelco sharply increased its 2026 premium to $350/ton over LME prices (vs $89 last year), signalling tightening supply and stronger regional demand. Smelter utilisation rates have fallen to a historic low near 75%, reinforcing expectations of a structurally tighter copper market.
Rate-cut expectations in the U.S. remain supportive, with markets pricing an 85% probability of easing in December and further cuts in 2026. In contrast, Norsk Hydro’s decision to shut five European plants highlights lingering weakness in aluminium demand.

Natural Gas

Natural gas prices edged higher to $4.60/MMBtu after the latest EIA report showed an 11 bcf storage draw—larger than expected and supportive for near-term sentiment. Updated forecasts pointing to colder-than-normal U.S. temperatures into early December have strengthened the demand outlook.
European gas continued to soften, entering its longest losing streak in four months, driven by mild winter expectations, strong LNG arrivals, and comfortable storage levels. Hopes of progress in Russia-Ukraine peace efforts added further downward pressure.