Crude oil prices fell to a six-week low on Friday, influenced by investor optimism that the Strait of Hormuz might reopen soon. Gold prices pared earlier gains as traders assessed conflicting signals regarding a potential U.S.-Iran truce. Aluminum prices on the London Metal Exchange (LME) moved higher, with supply disruptions from the strait's closure exacerbating market tightness, driving spot prices up and exchange inventories down sharply.

Crude Oil: Prices Drop to Six-Week Low as Traders Bet on Extended Truce Crude oil prices declined to a six-week low on Friday, driven by investor hopes for a swift reopening of the Strait of Hormuz. West Texas Intermediate (WTI) crude fell nearly 2%, settling around $87 per barrel, while the global benchmark Brent crude closed near $92. U.S. President Donald Trump stated he would make a "final decision" on extending a preliminary truce agreement with Iran. This followed reports from an informed source that Iran and the U.S. had reached a preliminary deal to extend the ceasefire by 60 days, during which further talks on Iran's nuclear program would commence. However, Trump's delayed decision has cast uncertainty over the final outcome. Iran's Foreign Ministry indicated that a final understanding has not yet been reached. Spokesperson Esmail Baghaei told the state-run Islamic Republic News Agency that information exchanges between Iran and the U.S. are ongoing. Crude oil prices weakened in May amid speculation that the U.S. and Iran might reach some form of agreement. Despite previous claims of progress from both sides, the stalemate has persisted. Chevron CEO Mike Wirth noted on Friday that oil traders appear to be betting the conflict is nearing resolution, which has capped price increases. He remarked, "The market psychology is that this is closer to the end than the beginning." At the close, July WTI crude fell 1.7% to settle at $87.36 per barrel. July Brent crude, which expired on Friday, dropped 1.8% to settle at $92.05 per barrel. The more active August contract declined 1.7%, closing at $91.12.

Precious Metals: Gold Pares Gains Gold prices trimmed earlier advances as traders weighed mixed signals about a potential U.S.-Iran truce, adding further uncertainty to the interest rate outlook that has recently influenced gold's direction. Gold's rally moderated after initially rising as much as 2.2% following Trump's comment about making a "final decision" on extending the preliminary truce. Later reports indicated Trump concluded a two-hour meeting without reaching a decision. A narrowing decline in U.S. Treasury yields and the dollar exerted pressure on the non-yielding, dollar-denominated precious metal. As of 4:11 p.m. New York time, spot gold was up 1.1% at $4,546.25 per ounce. Spot silver was largely unchanged at $75.6035 per ounce.

Base Metals: Aluminum Gains on LME Copper prices on the LME declined, while aluminum advanced. Supply constraints from the Strait of Hormuz closure are intensifying aluminum market tightness, leading to a surge in spot prices and a significant drop in exchange inventories. The Gulf region accounts for nearly 10% of global aluminum supply, making the Iran conflict particularly disruptive for global buyers. Despite renewed optimism about a potential resolution to the tensions, prolonged closure of the strait and direct attacks on regional smelters have prompted warnings of the aluminum industry facing its most severe shortage in decades. Fresh signs of supply tightness emerged on Friday, with the LME aluminum spot price premium over the three-month contract soaring to $97 per ton, reaching its highest level since 2007. At the close, LME three-month copper fell 0.5% to $13,636 per ton. LME aluminum rose 0.2% to $3,666.5 per ton. LME zinc declined 0.3% to $3,540 per ton. LME nickel dropped 0.2% to $19,062 per ton. LME tin advanced 0.6% to $55,418 per ton. LME lead edged down 0.1% to $2,016 per ton.