Commodities: industrial metals weaken, oil rises further
The Brent oil price continued its advance in June, reaching a level of USD 75 per barrel, which is about 10% above the level before the pandemic. This brings the increase since the beginning of the year to 45%. Also last month, the normalization of demand after the coronavirus pandemic was the main driver. The negotiations between the US and Iran on a new nuclear deal that would lift the embargo on Iran appear to have stalled. In early July, OPEC+ will decide whether to further increase supply by scaling back coronavirus production restrictions. Russia, as before, favors a broad easing, while Saudi Arabia wants to take a slower approach.
After the surge of the previous months, most industrial metals moved lower in June. The price of copper, for example, fell by almost 10%. This may be due to slower growth in China and the news that China is considering putting some of its strategic stock in metals such as copper, aluminum, and zinc on the market to control the price rise and counteract speculation.
Gold fell sharply last month (-7%), the weakest month in almost five years. The US central bank is adopting a less accommodating stance on its interest rate outlook, which weighed on the market. The somewhat firmer dollar is also a negative element for the price of gold.