FICC | Commodities

Special Report

We outline a framework for the Iran war's impact on the commodity outlook in the event of a prolonged Strait of Hormuz disruption. We break it down into three phases: (1) the Initial Shockwave, (2) the Ripple Effects, and (3) the Backwash. The first phase has largely passed, and we are now in the Ripple Effects phase.

Drone and ballistic missile attacks were slowing, as of March 11. Air traffic in the region was also slowly recovering, as the pace of attacks declined. Warning, however: Reports from US CENTCOM and the IDF claim that Iran still has around 40% to 50% of its stockpile of missiles and launchers. Attacks are continuing, even though at a reduced tempo.

The war in Iran is disrupting global oil and LNG flows and remains a threat to regional energy infrastructure. Energy price risks remain skewed to the upside over the near term.

Special Report

The global drive to build a resilient ex-China rare earth supply chain is accelerating. It has emerged as a strategic priority and is backed by both public and private sector investment in many countries. In this Special Report, we argue that rare earth adjacent plays present a more attractive opportunity for investors looking to gain exposure to the rare earth capex cycle than a pure-play strategy.

Oil price risks remain skewed to the upside over the near term as geopolitical risks continue to dominate. Nevertheless, we ultimately expect bearish fundamentals to reassert themselves over a six-to-12-month timeframe and drive oil prices lower.

This report flags near-term risks for gold. Yet we remain optimistic about the prospects for its long-term bull market.

The metals mania is fueling extreme volatility. In particular, the price of copper has become detached from fundamentals and is vulnerable to the downside.

After silver's parabolic surge, we assess the rally's vulnerability by examining its weakest links. We conclude that silver is ripe for a pullback.

Venezuelan crude output is unlikely to alter the global oil market outlook for this year. However, US control of Venezuelan crude is a risk to Canadian oil sands producers and Canadian oil prices. Go long US oil refiners/short Canadian oil producers.

The forces that have recently propelled aluminum prices will remain supportive over the near term. However, beyond the coming months, aluminum prices will retreat as bearish cyclical pressures overwhelm over the course of 2026.