Uncertainty Grips Global Commodities: Gold Resilient While Energy and Base Metals Retreat – Daryl Fletcher, Bannockburn Capital Markets
Why gold is standing tall while oil, copper, and natural gas struggle under the weight of macro uncertainty.
In this KE Report daily editorial, Darrell Fletcher, Managing Director of Commodities at Bannockburn Capital Markets, shares a trader’s-eye view of what’s behind the growing weakness in global commodity markets. While gold remains a standout, broad-based selloffs in energy and metals are being fueled by rising macro uncertainty, shifting capital flows, and weakening global economic data.
— Key Themes —
• A Unified Theme: Global Economic Uncertainty Is Driving Commodities Lower
“It's overtaken any kind of dollar movement… markets don’t like the uncertainty.”
Despite a weaker US dollar, commodity indices are falling across the board. S&P GSCI is down 7% month-to-date, LME base metals are off 3–4%, and energy is down 15% - signaling that macroeconomic unease, not currency, is in the driver’s seat.
• Fund Flows and Open Interest Show Capital Is Stepping Back
“Front-month open interest is down 40% in nat gas, 22% in crude, and 42% in Comex copper year-over-year.”
Darrell points to a clear withdrawal of capital from the futures market. This reflects not only a lack of conviction but also reduced liquidity and planning visibility among investors and producers.
• Oil Faces a Structural Bear Trend, But Natural Gas Remains 'Guarded'
“Crude is in a rare flat forward curve… even out 18 months, it's barely above $60.”
Falling oil prices and Saudi Arabia’s signal they’re "okay with lower for longer" paint a bearish picture. Meanwhile, natural gas appears more resilient, with inventories near normal and long-term pricing holding above $4.
• Gold Shines in the Storm, Supported by Western ETF Flows
“I don’t see any reason to sell gold right now, other than profit taking.”
Gold remains up 26% YTD and is benefitting from renewed Western investor interest. Amid weak Treasury performance and global policy unpredictability, gold stands alone as a perceived safe haven.
• Copper's Volatility Hints at Deeper Market Stress, Despite Bullish Long-Term Curve
“Despite recent weakness, 2027–2028 copper futures remain above $5 - the market sees long-term demand.”
Copper is seeing extreme volatility driven by China data, position squaring, and tariff uncertainty. Yet its future curve suggests underlying confidence in the metal’s long-term fundamentals.
If you find these insights helpful, don't forget to subscribe, leave a review, and follow us for more expert takes on commodity markets.