DBT Bureau
Pune, 28 May 2026
Global commodity markets remained volatile as escalating tensions between the U.S. and Iran disrupted energy supplies, pressured precious metals, and reshaped global trade flows, while industrial metals markets reflected mixed supply and production trends.
Precious metals extended losses for a second consecutive session as renewed U.S. military strikes in Iran increased uncertainty over prospects for a near-term peace agreement between the two nations. The strikes came only days after reports suggested that Washington and Tehran had negotiated a memorandum of understanding aimed at reopening the strategically vital Strait of Hormuz, raising earlier hopes of easing regional tensions.
Crude oil prices, however, moved sharply lower despite geopolitical risks, as the U.S. release of supplies from its Strategic Petroleum Reserve temporarily eased concerns over tightening global supply.
According to the International Energy Agency (IEA), global oil markets are expected to face a supply deficit this year, with the Iran conflict disrupting Middle Eastern production and tightening market balances.
Shipping activity through the Strait of Hormuz showed signs of recovery, with three LNG tankers recently transiting the key waterway carrying cargoes destined for Pakistan, China, and India. A supertanker transporting Iraqi crude to China also resumed its journey after being stranded for nearly three months. In addition, two supertankers exited the Strait last week, while another vessel continues to depart after months of delays involving a combined 6 million barrels of Middle Eastern crude.
Supply disruptions in the Middle East prompted Indian refiners to diversify sourcing strategies, increasing crude imports from Latin America and Africa to secure supplies.
In industrial metals, copper production in Chile weakened significantly. State-owned miner Codelco reported a 9.98% year-on-year decline in March output to 110,900 tonnes. Production at Escondida, the world’s largest copper mine, fell 15.75% to 101,600 tonnes, while Collahuasi, operated by Glencore and Anglo American, recorded a 10.80% drop to 31,400 tonnes.
Meanwhile, China’s aluminium sector remained resilient. The country’s aluminium output increased 3.1% year-on-year to 3.87 million metric tonnes in April. During the first four months of the year, China produced 15.33 million metric tonnes, marking a 3.5% rise from the same period last year.
Source: Geojit Investments Limited
