Commodity markets remained volatile as geopolitical uncertainty surrounding the US-Iran conflict continued to dominate sentiment across the energy complex. While signs of possible negotiations briefly weighed on oil markets, tightening physical balances and continued disruption to global energy flows maintained broader support across coal, gas and industrial commodities.
Prices at 17h00 BST
API2 (May): $112.00/mt API2 (June): 124.00/mt
API4 (May): $117.50/mt API4 (June): $119.50/mt
Brent Crude: $110.92/bll down 1.05%
SGX Iron Ore 62Fe: $109.55/mt down 0.18%
LME 3-Month Copper: $13,409.00/mt down 1.39%
Coal
Volatility across the energy complex continued through today’s session, with European gas prices strengthening sharply and front-month TTF closing around 3.5% higher. API2 coal prices also rallied strongly, supported both by the strength in European gas markets and firmer physical DES ARA pricing, which traded materially above yesterday’s offer levels and stimulated renewed buying interest.
The broader strength in API2 also provided support to API4 and NEWC swaps, with sentiment across the coal complex remaining underpinned by continued uncertainty surrounding global energy supply flows and elevated replacement costs.
Brent Crude
Oil prices moved lower today after US President Donald Trump announced that a planned military strike on Iran had been paused to allow negotiations to continue. Brent crude futures fell around 1% during the session, although volatility remained elevated as markets continued reacting to rapidly changing geopolitical headlines. Trump stated that the United States remained prepared to resume military action should negotiations fail, reinforcing the fragile and highly uncertain nature of current diplomatic efforts. Despite the temporary easing in tensions, the Strait of Hormuz remains effectively closed, continuing to represent one of the largest disruptions to global oil and LNG supply flows in recent history.
Iran’s latest proposal reportedly includes demands for a cessation of hostilities across multiple fronts, the withdrawal of US forces from areas near Iran and compensation linked to war-related damage. Meanwhile, the United States extended a sanctions waiver allowing certain energy-vulnerable countries to continue purchasing Russian seaborne crude. Global oil markets continue to balance hopes for diplomacy against tightening physical balances. Strategic petroleum reserve drawdowns in the United States and declining crude inventories are continuing to reinforce concerns surrounding supply availability heading into peak summer demand season.
Iron Ore
Iron ore futures traded weaker today, with the most-traded DCE September contract closing down 0.87% at 798.5 yuan/mt. Portside spot prices were broadly stable, changing between flat and up 3 yuan/mt, while overall spot market activity remained subdued.
Steel mills largely maintained a cautious wait-and-see approach, with procurement continuing to focus on immediate production requirements. Despite softer sentiment, underlying demand fundamentals remained relatively supportive.
SMM survey data indicated that blast furnace maintenance impacts are expected to ease further next week, supporting expectations that pig iron production will remain elevated overall. Strong steel exports and resilient downstream demand outside China are also continuing to underpin iron ore consumption, limiting downside pressure despite short-term price weakness.
Copper
Copper prices edged lower today as inflation concerns, elevated energy prices and weaker Chinese economic data weighed on broader industrial metals sentiment. Three-month LME copper declined around 0.3% to $13,544.50/mt.
Analysts noted that the recent pullback follows a strong rally earlier this month, with macroeconomic concerns now temporarily offsetting underlying supply-side support. Ongoing geopolitical tensions and higher oil prices continue to raise concerns over inflation persistence and tighter monetary policy, both of which could weigh on global industrial activity and metals demand.
At the same time, softer Chinese data across retail sales, investment and industrial production added further pressure to sentiment. Nevertheless, copper remains well supported structurally, with prices still up more than 8% year-to-date amid ongoing supply constraints and continued demand growth linked to electrification, AI infrastructure and energy transition investment.
Despite periodic volatility linked to geopolitical headlines, commodity markets continue to reflect a broader environment of tightening physical balances and increasingly constrained supply chains. Energy security concerns, resilient industrial demand and structural supply limitations across several key commodities are expected to continue supporting markets even as macroeconomic uncertainty remains elevated.
