Commodity Calls: Week Ending 21 March 2025

Copper futures rally on tariff fears, gold hits all-time high as geopolitical tensions resume, and crude oil regains war premium on Middle Eastern conflict.

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Copper

Bullish

• Copper futures in the US neared all-time highs as investors rushed to ship the metal stateside before possible tariff enforcement.¹ Last month, President Trump ordered the US Commerce Department to investigate the nation’s imports of copper as a pre-cursor to copper tariffs. This kicked off a rally in US copper futures, which has only intensified since the President’s announcement of broad-sweeping tariffs on April 2nd.²
• China is planning to frontload acquisitions of copper, among other metals, for its national strategic reserve this year.³ According to Bloomberg, the National Development & Reform Commission (NDRC), China’s top planning body and manager of strategic stockpiles, signalled it would “move faster to fulfill the yearly task of stockpiling strategic goods”.

Bearish

• Markets are concerned that President Trump’s April 2nd tariffs may cause widespread economic slowdown.⁴ In particular, parts of Asia may see growth downgrades as demand for goods decreases on higher costs. Analysts have also become increasingly concerned at the risk of stagflation in the US.

Explore copper with WIRE.

Gold

Bullish

• Gold hit an all-time high of US$3054.40 on March 20 as investors sought protection from geopolitical and economic risks.⁵ Russia refused a 30-day ceasefire deal proposed by the US last week, pledging only to stop attacking Ukrainian energy infrastructure.⁶ The temporary truce between Israel and Hamas also came to an end on the same day, with the former launching a wave of deadly strikes on the Gaza strip.⁷ Finally, investors remain concerned on the economic impact of widespread tariffs, as well as any retaliatory trade wars.

Bearish

• Gold backed off from all-time highs after President Trump’s team reframed the proposed tariffs coming on April 2nd as “targeted”, rather than broad sweeping.⁸ The announcement should still remain a significant expansion of US tariffs; however, officials have revealed that it will exclude some nations.

Explore physical gold with GOLD and GXLD.

Crude Oil

Bullish

• Crude oil regained its war premiums after the ceasefire between Israel and Gaza broke down.⁹ The reignition of war between Israel and the Hamas once again risks regional escalation, notably Iran.

Bearish

• Oil production in Kazakhstan reached an all-time high this March, despite the country’s pledges to meet OPEC+’s decrease production quota.¹⁰ Kazakhstan has consistently overproduced above its OPEC+ limit, and is one of the biggest overproducers alongside Iraq and Russia.

Explore crude oil with BCOM.

Forecasts are not guaranteed and undue reliance should not be placed on them. This information is based on views held by Global X as at 26/03/2025. Investing involves risk, including the possible loss of principal. Diversification does not ensure a profit nor guarantee against a loss.

Brokerage commissions will reduce returns.

This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. This information is not intended to be individual or personalised investment or tax advice and should not be used for trading purposes. Please consult a financial advisor or tax professional for more information regarding your investment and/or tax situation.