Commodities Wrap: Copper Surges on ‘Green Squeeze’ Fears; Oil Dips on Peace Hopes

LONDON — Global commodity markets diverged sharply at the start of the week, driven by opposing narratives of supply scarcity in metals and geopolitical de-escalation in energy.

Copper's Strategic Rally

COMEX Copper jumped 5% to $5.85 per pound, while Shanghai futures broke the critical 100,000 yuan/tonne barrier. The rally is fueled by a “green squeeze”—a structural shortage of copper needed for renewable energy grids and AI data centers.

Goldman Sachs projects a global refined copper deficit of 500,000 tonnes in 2026, forcing a scramble for physical inventory. The prospect of U.S. tariffs and tax changes in 2026 is also driving an arbitrage window, sucking inventory into American warehouses.

Crude Oil Wavers

In contrast, energy markets softened. Brent Crude and WTI both fell over 2.5%, with WTI settling near $56.74. The decline reflects traders pricing out the “war premium” following reports that U.S.-brokered peace talks between Russia and Ukraine have reached advanced stages.

However, downside remains cushioned by OPEC+ supply discipline and the physical reality that, despite talk of peace, Russian output remains constrained by sanctions and infrastructure challenges.