WTI crude fell to its lowest level since February 2021 as traders weighed renewed optimism over a potential resolution to the Russia-Ukraine conflict alongside mixed economic data from China. Copper prices rose, partially recovering from Friday’s losses, as investors refocused on tightening supply prospects for next year. Gold held steady near record highs.
**Crude Oil: WTI Hits 2021 Low as Traders Assess Ukraine Deal Prospects** WTI crude dropped to its lowest level since February 2021 amid cautious optimism over potential peace talks to end the Russia-Ukraine war.
In thin pre-holiday trading, WTI settled below $57 per barrel.
U.S. negotiators reportedly proposed more substantive security guarantees for Kyiv, though the move appeared aimed at pressuring Ukrainian President Volodymyr Zelenskiy into territorial concessions.
Oil is headed for an annual decline as supply continues to outpace demand this year and next.
"While a ceasefire wouldn’t immediately flood the market with Russian crude, it would significantly reduce future supply disruption risks," said Rebecca Babin, senior energy trader at CIBC Private Wealth Group.
However, Babin noted that lingering uncertainties around the peace deal could provide some support for oil prices.
January WTI futures fell 1.1% to $56.82 in New York, while February Brent crude declined 0.92% to $60.56—its lowest close since May.
**Base Metals: Copper Rebounds** Copper prices climbed, recouping some of Friday’s losses as investors shifted focus to tightening supply expectations for 2024.
LME copper rose as much as 3.3% on Monday after a 3% drop Friday, when AI-related stock sell-offs raised concerns over demand for the metal used in wiring and renewable energy equipment.
Year-to-date, copper has surged over 30% due to mine disruptions, pre-tariff shipments to the U.S., and optimism over green energy investments.
"Despite global economic concerns, demand continues to outperform expectations. We remain bullish on copper, with the market likely shifting into deficit by 2026," said ANZ analysts including Brian Martin.
At the close, LME copper rose 1.22% to $11,655.5/ton, while aluminum dipped 0.09% to $2,866. Aluminum, nickel, and zinc also saw declines.
**Precious Metals: Gold Holds Near Records** Gold traded flat near all-time highs as investors weighed tech valuations and U.S. rate outlooks.
Prices briefly rose 1.2% before stabilizing in U.S. trading. On Friday, gold and silver retreated sharply from intraday peaks as Wall Street locked in AI-driven gains.
Fed policy expectations continue to influence gold forecasts.
Spot silver gained 3.31% to $64.0121/oz, while spot gold edged up 0.09% to $4,303.6/oz.
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