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Daily Base Metals Report

Markets Rally As Strait Reopens, But Normalisation Remains Incomplete

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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 unwinding risk premium as Strait flows resume, with dollar and yields easing further.
  • Base metals remain elevated despite the initial shock, suggesting residual geopolitical premium and underlying support.
  • Precious metals strengthen on macro drivers, while oil drops sharply but remains above fully normalised levels.

Macro

US equities moved higher, supported by confirmation that the Strait of Hormuz has reopened to commercial traffic, easing immediate supply fears. However, the reopening comes with restrictions and continued US naval presence, meaning flows are still below normal and the situation remains controlled rather than resolved.

The reaction across macro assets was clear. The dollar index dropped below 98.0, while the US 10-year yield moved down towards 4.2%, reflecting a further unwind of the geopolitical risk premium. Markets are increasingly pricing a de-escalation outcome, although the persistence of operational constraints suggests some residual risk will remain.

Base Metals

Base metals saw sharp intraday moves, highlighting how sensitive the complex remains to geopolitical headlines.

Aluminium dropped quickly to $3450/t on the news before recovering to $3550/t, still trading more than 13% above pre-conflict levels. The limited follow-through on the downside suggests that a meaningful portion of the geopolitical premium remains embedded. The cash-to-three-month spread held around 30 backwardation, pointing to continued tightness in the nearby structure despite easing fears.

Copper was volatile but closed higher around $13350/t. The price action reinforces the current dynamic, with the market reacting quickly to macro shifts but still showing underlying support, suggesting buyers remain active on dips.

Zinc broke above the $3440 resistance, reaching $3480/t, but failed to hold those levels and closed back below. The rejection at resistance suggests that while momentum is positive, higher levels continue to attract selling interest.

Overall, the complex remains elevated, but today’s price action suggests that as geopolitical risk fades, the market will need new drivers to sustain further upside.

Precious Metals

Precious metals moved higher, with gold rising towards $4880/oz and silver reaching $83/oz. The move comes alongside the broader easing in yields and the dollar, reinforcing that bullion is currently trading as a macro asset.
Oil prices dropped sharply, with WTI falling below$ 90/bbl to around $83/bbl and Brent near$ 99/bbl. The move reflects the reopening of the Strait and the unwind of extreme supply concerns, although prices remain above pre-conflict levels due to ongoing operational constraints.

Looking ahead, the key shift is that the market is moving from disruption pricing to normalisation pricing. However, with flows still restricted and the geopolitical situation unresolved, this transition is unlikely to be smooth, leaving markets sensitive to any change in the narrative.

All price data is from 17.04.2026 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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