Latest Commodity News

Oil prices have shown stability as market participants consider the potential for supply shortages. This comes in light of U.S. President Donald Trump's push for a swift resolution to the war in Ukraine, which involves implementing more tariffs. However, increased U.S. crude stocks have introduced downward pressure on prices.

As of July 31, Brent crude futures experienced a slight decline, with the September contract falling 10 cents to $73.14 a barrel. Similarly, the U.S. West Texas Intermediate crude dropped marginally to $69.95. Despite these minor drops, both benchmarks had settled higher the day before, indicating market fluctuation.

Market analysts note a lack of strong conviction among buyers and sellers, leading to tight price oscillations. Concerns about the impact of upcoming U.S. tariffs on Russian oil are influencing buying interest, while a strong dollar and low global growth indicators are staving off gains. Recent changes in U.S. crude oil inventories indicate unexpected increases, but a larger-than-expected drop in gasoline stocks suggests ongoing robust demand during the driving season.

A powerful earthquake with a magnitude of 8.8 struck off the coast of Petropavlovsk-Kamchatsky in Russia, leading to tsunami warnings that extended as far as French Polynesia and Chile. The quake occurred on a shallow fault line and caused significant damage in the region, injuring several people but miraculously not resulting in casualties, likely due to strong building codes and efficient alert systems. Meanwhile, impacted areas in Japan and Hawaii were quickly issued evacuation orders before warnings were eventually downgraded.

The tsunami generated waves that affected several locations across the Pacific. In the Marquesas Islands of French Polynesia, waves measuring up to 2.5 meters were observed, while Hawaii and Japan recorded waves of up to 1.7 meters and 1.3 meters, respectively. Waves also reached California and Canada but did not necessitate further evacuations there. The overall situation allowed flights out of Honolulu to resume within hours of the earthquake.

Amid the chaos generated by the earthquake and tsunami, the Klyuchevskoy volcano on the Kamchatka Peninsula erupted, with significant lava flow observed. People in surrounding areas were alerted to move to safer locations as extra caution against further seismic activity was suggested. Authorities in the Galapagos Islands also issued evacuation orders as precautionary measures were enforced across multiple nations affected by the outgoing tsunami waves, but no injuries were reported at Japanese nuclear facilities.

The earthquake's occurrence is a stark reminder of the significant geological activity present in regions like Kamchatka, located on the Pacific Ring of Fire. This region regularly experiences both earthquakes and volcanic eruptions due to tectonic movements between the Pacific Plate and the North American Plate. Experts predict that while the impact from this quake has been managed relatively well, further aftershocks should not be ruled out.

The recent trade deal between the United States and South Korea has resulted in South Korea agreeing to invest $350 billion in U.S. projects, while also committing to purchase $100 billion worth of energy products. This agreement, announced by President Trump after negotiations with South Korean officials, aims to strengthen economic ties and reduce trade tensions. The lower tariff rate of 15% on South Korean automotive imports, rather than the initially threatened 25%, symbolizes a significant step forward in bilateral relations.

During negotiations, South Korean President Lee Jae Myung emphasized the importance of this deal in removing uncertainties from their export environment. The investments are categorized into various sectors, with $150 billion allocated for shipbuilding and $200 billion for industries such as nuclear power and biotechnology. Despite this positive development, South Korea's rice and beef markets will remain closed to further imports from the U.S., which has been a sticking point in discussions.

While the deal opens up avenues for increased collaboration, challenges remain regarding the structure and implementation of the investment fund. Key officials, including U.S. Commerce Secretary Howard Lutnick, noted the expectations for the profits from these investments to primarily benefit the American economy. Furthermore, the energy purchases from the U.S. would include liquefied natural gas (LNG), liquefied petroleum gas (LPG), and crude oil, which may shift South Korea's import patterns.

The political climate in South Korea remains turbulent, with the recent impeachment of former President Yoon Suk Yeol contributing to the complexity of negotiations. Nonetheless, this trade agreement and the associated investments symbolize a significant commitment to fortifying economic relationships between the two nations, especially amid ongoing global trade tensions.

U.S. President Donald Trump announced a series of tariffs on imports, significantly impacting the copper market. Effective Friday, a 50% tariff will be imposed on copper pipes and wiring, a move that led to a dramatic drop in copper prices by over 17% on the Comex exchange. Trump's decision was part of a broader strategy to reshape global trade relations, particularly with Brazil and South Korea, as higher U.S. tariffs are set to take effect.

The specifics of the tariff focused primarily on certain copper products, leaving out broader categories like ores and concentrates. Analysts noted that while the tariffs aim to support domestic manufacturing, they might not sufficiently benefit the U.S. copper mining industry, which has long sought regulatory reforms to enhance its growth prospects. This situation may positively affect countries like Chile and Peru, which are major suppliers of copper to the U.S.

Brazil's response included an acknowledgment of the tariff impacts, but officials described the situation as less severe than anticipated. They noted some sectors were exempt from the tariffs, softening the blow. Similarly, South Korea will face a reduced tariff of 15% due to a significant investment agreement with the U.S., highlighting a cooperative approach amid trade tensions. This agreement includes major investments in various sectors, including shipbuilding and energy.

Trump's administration is also suspending a previous exemption for low-value shipments, meaning that goods sent valued at $800 or less will now be subject to applicable tariffs. This move may affect smaller businesses and consumers who rely on affordable imports.

Asian equities experienced a downturn, influenced by disappointing economic data from China and a significant drop in copper prices. The Japanese yen strengthened after the Bank of Japan decided to maintain interest rates while raising its inflation forecast, signaling potential future rate hikes. Despite these developments, Japanese stocks showed minimal reaction to the BOJ's decision.

Investors were also processing various news from the U.S., including a trade deal with South Korea, a steady interest rate decision by the Federal Reserve, and strong earnings reports from major tech companies. The Federal Reserve's decision to keep rates steady was a notable move, with two governors dissenting, marking a change in the committee's dynamics.

The U.S. economy demonstrated some unexpected strength, as GDP growth rebounded in the second quarter. However, concerns remained about slowing growth and the uncertainty surrounding President Trump's trade policies. The announcement of tariffs on imports from South Korea, intended to boost U.S. investments, added complexity to the market landscape.

In commodities, copper futures dropped sharply following new tariff announcements affecting copper products, while oil prices saw little movement. The mixed economic signals and ongoing trade negotiations cast a shadow over global market stability.

The United States and Pakistan have recently reached a significant deal aimed at lowering tariffs for Pakistan and enhancing collaboration on oil reserve development. This agreement was announced by U.S. President Donald Trump on social media, although he did not provide specific details regarding the tariff reductions or the oil company that would lead the partnership. Pakistani Foreign Minister Ishaq Dar confirmed the agreement but also did not elaborate further.

Under the newly established deal, Pakistan is expected to see a reduction in reciprocal tariffs on its exports to the U.S., which could greatly benefit the South Asian nation, especially after facing potential tariffs of up to 29%. Discussions between U.S. officials and Pakistani representatives have been ongoing, culminating in this trade agreement which promises to usher in a new era of economic collaboration between the two countries in energy, mining, and technology sectors.

This agreement also occurs against the backdrop of rising U.S. trade relations with Pakistan, which reported a total goods trade of $7.3 billion in 2024. As part of broader geopolitical strategies, this deal reflects the U.S. intent to strengthen ties with Asian nations like Pakistan, especially in light of rising tensions with India. Although Trump claimed credit for facilitating a ceasefire between Pakistan and India, this remains disputed by Indian officials, emphasizing the complex dynamics at play in South Asian politics.

Oil prices remained stable on Thursday in Asian markets, holding onto gains from the earlier week amid rising geopolitical tensions and new tariff measures that could significantly alter global crude oil flows. As of Thursday morning, West Texas Intermediate (WTI) crude was priced at $69.99 per barrel, while Brent crude traded at $73.10 per barrel. Despite a slight dip, both crude benchmarks gained about 7% this week, fueled by concerns over supply restrictions resulting from new U.S. sanctions and trade policies.

President Trump recently shortened the deadline for Russia to negotiate a peace agreement with Ukraine, instating a 10-12 day timeframe. He warned of secondary tariffs of up to 100% on nations continuing to buy Russian oil, which has raised pressure on India, a significant buyer of Russian crude. Concurrently, Trump confirmed a 25% tariff on Indian imports would commence on Friday, creating uncertainty for Indian refiners and echoing throughout global oil markets, particularly shifting the Brent-Dubai spread into discount territory.

The U.S. Energy Information Administration reported a substantial increase of 7.7 million barrels in crude inventories for the week ending July 25, attributed to a significant drop in exports. However, gasoline stocks fell by 2.7 million barrels, indicating robust demand during the busy U.S. driving season. Despite these mixed inventory signals, geopolitical events overshadowed market reactions. New U.S. sanctions targeting Iran-linked entities further exemplify Washington's strategy to exert economic pressure on major oil producers, hinting at possible supply constraints in the near future.

Demand concerns persist, exacerbated post-Federal Reserve's hawkish statements, holding back oil prices. Traders are anticipated to closely monitor upcoming inflation data and employment figures that could influence market sentiment.

Gold prices saw a rebound on July 31, recovering from a recent one-month low as trade uncertainties triggered by new U.S. tariffs increased the metal's appeal. Spot gold rose 0.5% to $3,292.24 per ounce, following a drop to $3,267.79 the day before, the lowest since June 30. Traders were drawn to gold at lower price levels due to ongoing economic uncertainties, which are compounded by U.S. tariff announcements.

U.S. President Donald Trump announced tariffs impacting various goods, including a 15% tariff on South Korean imports and changes to previous levies on copper imports. He also confirmed a 25% tariff on Indian goods and expressed confidence regarding trade negotiations with China. These tariff threats are expected to contribute to market volatility and affect investor sentiments.

The U.S. Federal Reserve kept its interest rates unchanged, which dampens the expectations for any imminent rate cuts. Economically, gold is seen as a safe-haven asset and generally performs well in scenarios of low-interest rates. Analysts highlight a support level around $3,250 for gold prices, with concerns that a significant breach could further lower prices.

President Trump announced that the U.S. would impose a 15% tariff on imports from South Korea to avoid higher tariffs. This decision is part of a broader trade agreement that includes a $350 billion investment from South Korea into the U.S. The deal specifically reduces U.S. tariffs on South Korean automobiles from 25% to 15%, matching the rates applied to Japan and the European Union. Under this agreement, South Korea will allow American cars and trucks into its markets without import duties.

Furthermore, the deal covers various sectors, including steel and pharmaceuticals, where South Korean firms will not face disadvantages compared to companies from other nations. The U.S. retains high tariffs on steel and aluminum while agreeing to address concerns regarding potential tariffs on chips and pharmaceuticals. The agreement aims to level the playing field for South Korean businesses in comparison to their international competitors.

Additionally, Trump emphasized that South Korea would invest a total of $350 billion in American projects, mainly focusing on shipbuilding, chips, batteries, biotechnology, and nuclear energy. A significant part of this investment would come via loans and guarantees, with South Korean officials indicating that the details were intentionally kept ambiguous. In energy, South Korea is set to purchase $100 billion of liquefied natural gas, which is likely to result in a shift in energy imports.

On agriculture, South Korea agreed to import American farm products without duties, continuing to negotiate over issues such as rice and beef tariffs. Digital services regulations and security matters were not addressed in the current negotiations and are planned for future discussions. Moreover, currency policy discussions between South Korea and the U.S. are also set to continue through separate channels.

Asian equities experienced a decline due to disappointing economic data from China and a significant drop in copper prices. Investors are also assessing the implications of a trade agreement between South Korea and the U.S. Meanwhile, the dollar maintained its position near a two-month high following a Federal Reserve announcement regarding interest rates.

Recent earnings reports from major tech companies, including Meta and Microsoft, showed remarkable growth in revenue driven by cloud computing and advertising technologies, which contributed to some market stability. However, overall Asian markets showed signs of weakness, particularly in Hong Kong and China, which were affected by lower than expected Purchasing Managers' Index (PMI) numbers.

Attention is now focused on the Bank of Japan as it prepares to announce its policy decision, with traders eager for insights from Governor Kazuo Ueda about potential rate increases later this year. The Federal Reserve opted to keep interest rates steady for the fifth consecutive meeting, citing the need for further data before deciding on rate cuts.

In commodities, oil prices have risen for four consecutive days due to concerns regarding supply shortages exacerbated by geopolitical tensions and tariff discussions. While copper prices took a significant hit following tariff announcements, crude oil prices continued to show an upward trend.