Brent crude climbed to its highest level since late July as fresh attacks targeted energy infrastructure in the Middle East, with reports of explosions near Iran's critical oil export hub at Kharg Island intensifying concerns over potential supply disruptions. London copper extended its upward trajectory, buoyed by tight near-term supply and expectations that the U.S. may impose tariffs on refined copper imports. Gold slipped as traders weighed escalating Middle East tensions against a weakening dollar-yen pair.
Oil: WTI Hits Three-Month High on Kharg Island Strike
Brent crude rose approximately 1% to settle at $97.92 per barrel, briefly approaching the $100 mark during intraday trading, marking its strongest close since the end of July. WTI futures advanced 1.7% from Friday's settlement to $93.03 per barrel, reaching their highest level since early June. The rally followed Saudi Arabia's announcement that several of its energy facilities had suspended operations due to Houthi attacks. Shortly before Brent's settlement, Iran's semi-official Mehr news agency reported explosions at Kharg Island, a facility of paramount importance to Iranian oil exports, making any potential disruption highly market-sensitive. Analysts at Goldman Sachs, including Daan Struyven, noted in a report that "the market is increasingly pricing in a scenario of prolonged Middle East conflict," prompting a modest upward revision to their oil price forecasts based on assumptions that shipping disruptions may persist through 2027, while stating that "risks to price forecasts remain significantly skewed to the upside." Relatively thin trading volumes following the U.S. Labor Day holiday weekend contributed to heightened volatility in the market. Beyond Middle East tensions, oil traders are also directing greater attention to the outlook for refined products.
Copper Extends Record Run on Supply Tightness and Tariff Fears
London copper continued its advance, supported by near-term supply constraints and market expectations of potential U.S. tariffs on refined copper imports. LME copper gained 1.4% to reach $14,708.50 per metric ton, while LME aluminum rose 0.9% to $3,341 per ton, LME nickel climbed 0.9% to $16,868 per ton, LME zinc added 1% to $4,022 per ton, LME tin declined 0.5% to $54,862 per ton, and LME lead increased 0.8% to $1,915 per ton.
Gold Declines as Traders Assess Middle East Turmoil and Dollar Dynamics
Gold prices fell as market participants balanced the impact of heightened Middle East tensions against a weakening dollar-yen pair. Bullion dropped as much as 1.1% as escalating regional conflict pushed oil prices higher, fueling concerns about rising interest rates, which typically weigh on the non-yielding metal. Market pricing now suggests traders see a greater than 50% probability of a Federal Reserve rate hike this month. U.S. military strikes targeted sites near Kharg Island and the port city of Jask, while the yen strengthened toward its strongest level of the year against the dollar, extending last week's gains on rising expectations of a Bank of Japan rate increase. Given gold's traditional inverse relationship with the dollar, the greenback's weakness provided only partial offset. "Today's stronger oil prices are driving bond yields higher, weighing on gold, while dollar weakness only offsets part of that impact," said Ole Sloth Hansen, head of commodity strategy at Saxo Bank. Traders are now focusing on key U.S. inflation data due later this week, which could offer fresh clues regarding the Fed's next move at its September 14-15 meeting. As of 4:45 p.m. in New York, spot gold was down 1% at $4,357.88 per ounce, with silver retreating 0.7% to $65.704 per ounce. Platinum and palladium also declined, while the dollar index slipped 0.1%.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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