To The Moon

Crude oil finished the week in the red, as the steady flow of millions of barrels through the Strait of Hormuz tempered price gains despite ongoing uncertainty over the conflict with Iran. Copper notched a ninth consecutive weekly advance amid persistent market focus on tight supply. Gold suffered a sharp decline after hawkish remarks from Warsh fueled expectations for US interest rate hikes.

Crude Oil: Weekly Loss Recorded as Traders Watch Hormuz Flows

Oil prices recorded a weekly decline, with the ongoing transit of millions of barrels through the Strait of Hormuz curbing upward momentum even as the direction of the war with Iran remains unclear. The November Brent contract fell 0.5% to settle at $88.10 a barrel. West Texas Intermediate slipped 0.2% to $83.40 a barrel, marking a weekly drop of roughly 4%. Despite persistent threats from Iran against shipping, crude flows through the Strait of Hormuz appear to be slowly recovering. Traders have been closely parsing every diplomatic development to gauge potential impacts on the world's most critical energy chokepoint, though the prospect of a sustainable agreement remains murky.

The US has struck a harder line toward Iran in recent days, with President Trump signaling he would not lift the naval blockade on Iranian ports, a key demand from Tehran. Reports indicate Trump has no intention of restoring terms from the June ceasefire agreement with Tehran, which has eroded confidence in a possible revenue-sharing deal between Iran and Oman regarding the Strait of Hormuz. That said, US economic measures against Tehran and its trading partners have so far been less severe than markets had anticipated. Iranian Foreign Minister Abbas Araghchi posted on X that he had held "creative discussions" with Qatar's Prime Minister in Tehran, suggesting that "getting diplomacy back on track is not impossible." He added, however, that diplomatic progress "depends on whether the US understands a simple fact: pressure does not work."

Base Metals: Copper Nears Record Highs on Supply Concerns

Copper prices edged closer to all-time highs amid ongoing supply tightness in the market. The metal climbed above $14,300 a tonne and posted its ninth consecutive weekly gain, the longest such streak since 2020. Short-term supply disruptions continue to dominate copper market dynamics, while the monetary policy outlook under Fed Chair Warsh has also become a focal point. At settlement, three-month copper on the LME rose 0.1% to $14,294 a tonne. LME aluminum added 0.2% to $3,242 a tonne, while nickel slipped 0.1% to $16,861 a tonne. Zinc was little changed at $3,883 a tonne, tin dipped 0.2% to $55,223 a tonne, and lead fell 0.5% to $1,905.50 a tonne.

Precious Metals: Gold Slumps as Rate Hike Bets Intensify

Gold suffered a sharp drop after Fed Chair Warsh reiterated his commitment to curbing inflation, prompting markets to increase bets on rate hikes this year, a bearish signal for the metal. Bart Melek, global head of commodity strategy at TD Securities, noted: "The market is interpreting this as a greater likelihood of Fed rate hikes in September and December, marking a significant shift from expectations prior to Warsh's comments." Traders also attributed the decline to selling by trend-following commodity trading advisors, which exacerbated gold's slide. As of 4:59 PM ET, spot gold was down 3.1% at $4,455.11 an ounce, while spot silver fell 4.1% to $66.3815 an ounce.