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Daily Base Metals Report

Oil Rebuilds Premium as Hawkish Signals Reverse Relief Rally

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Authors
Daria Efanova

Daria Efanova Head of Research

Viktoria Kuszak

Viktoria Kuszak Senior Research Analyst

Contact research Contact Industrial Commodities

Summary

•    Markets are repricing a longer conflict, with stronger oil, yields and the dollar reinforcing tighter financial conditions. 
•    Base metals remain rangebound, with dollar strength offsetting supply risks and limiting directional conviction. 
•    Oil is rebuilding its risk premium, while precious metals continue to track macro drivers.

Macro

US equities opened lower, reversing part of the recent gains as sentiment deteriorated following more hawkish and less conciliatory comments from President Trump, which reduced expectations of a near-term resolution in the Middle East conflict. The shift in tone reinforced the view that de-escalation remains uncertain, with continued strikes and no meaningful progress on restoring full energy flows through the Strait of Hormuz.

Macro assets reacted quickly. The dollar index jumped above 100.2 before easing back towards 99.9, while the US 10-year yield rose to around 4.38%, reflecting renewed concerns that elevated oil prices will continue to feed through into inflation expectations.

Oil and the dollar moved closely together, highlighting that both are currently being driven by the same underlying factor: the geopolitical risk premium. This linkage matters, as it effectively tightens financial conditions further whenever tensions escalate.

Base Metals

Base metals were subdued, with the stronger dollar limiting follow-through despite the shift in macro conditions.

Aluminium edged lower, trading below $3,480/t, while zinc held around $3,260/t.

Copper remained rangebound, hovering around $12,350/t, continuing to show resilience despite the stronger dollar. The lack of directional move suggests that markets are waiting for a clearer signal, with macro drivers and positioning keeping prices contained.

Overall, we see the complex in a holding pattern, with conflicting forces between macro pressure and supply-side support preventing a clear trend from emerging.

Precious Metals

Precious metals gave back part of yesterday’s gains, moving in inverse correlation with oil as the energy market regained strength.

Gold found support near $4,550/oz and traded back towards $4,660/oz, while silver held $70/oz before moving towards $72/oz. The price action reinforces the current dynamic, where bullion is highly reactive to short-term macro shifts, particularly moves in yields, the dollar and oil.

Oil prices pushed higher again, with WTI above $105/bbl and Brent above $110/bbl, as markets reassessed the likelihood of a prolonged disruption. The renewed strength reflects the view that recent optimism may have been premature, with the risk premium being rebuilt.

Oil remains the dominant driver of cross-asset behaviour, with metals,  particularly precious,  reacting more to shifts in macro conditions than to geopolitical risk itself.

All price data is from 02.04.2026 as of 17:30

 

Disclaimer

This is a marketing communication. The information in this report is provided solely for informational purposes and should not be regarded as a recommendation to buy, sell or otherwise deal in any particular investment. Please be aware that, where any views have been expressed in this report, the author of this report may have had many, varied views over the past 12 months, including contrary views.

A large number of views are being generated at all times and these may change quickly. Any valuations or underlying assumptions made are solely based upon the author’s market knowledge and experience.

Please contact the author should you require a copy of any previous reports for comparative purposes. Furthermore, the information in this report has not been prepared in accordance with legal requirements designed to promote the independence of investment research. All information in this report is obtained from sources believed to be reliable and we make no representation as to its completeness or accuracy.

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