Oil prices advanced on Monday. Traders were assessing the prospects for upcoming US-Iran peace talks after weekend clashes in the Strait of Hormuz once again highlighted the fragility of the Middle East ceasefire. Copper prices declined, with traders also weighing the outlook for US monetary policy against a backdrop of a hawkish Federal Reserve stance. Gold prices moved lower.

Oil: Crude Prices Rise as Attacks Pause but Hormuz Traffic Slows

Oil prices moved higher on Monday. Traders were evaluating the prospects for imminent US-Iran peace negotiations following weekend clashes in the Strait of Hormuz that underscored the precarious nature of the regional ceasefire.

West Texas Intermediate crude rose more than 2%, settling near $71 per barrel. Brent crude gained 1.6%. An unnamed US official stated that Tehran and Washington have currently paused their tit-for-tat attacks, allowing vessels to pass freely through the Strait of Hormuz.

US President Trump indicated that peace talks between the two sides would resume on Tuesday in Doha.

Iran's foreign ministry announced it would send a delegation of experts to Doha but would not meet directly with the US team. Iran also stated it would proceed with plans to manage maritime traffic in the Strait of Hormuz, even without Omani participation.

Due to the volatile situation, observed traffic through the Strait of Hormuz decreased over the weekend. Global investors, shipowners, and insurers are closely monitoring shipping activity in this critical waterway.

"While there is still passage through the Strait of Hormuz, I'm hearing it has slowed compared to last week due to the unrest," said Dennis Kissler, head of energy trading at BOK Financial Securities Inc. "The market has priced in some supply reduction, and with futures previously oversold, we are set for a significant adjustment."

Brent crude for August delivery rose 1.6% to settle at $73.15 per barrel; the August contract expires on Tuesday. The more actively traded September futures contract gained 1.8%, settling at $73.91 per barrel.

WTI crude for August delivery increased by 2.2%, settling at $70.75 per barrel.

Base Metals: London Copper Declines

Copper prices fell as traders awaited fresh developments in US-Iran talks and assessed the US monetary policy outlook in the context of a hawkish Federal Reserve stance.

London Metal Exchange copper settled down 0.6% at $13,278.50 per metric ton. The metal is down 2.6% so far this month after hitting a record high in May. Beyond the Middle East conflict, traders are closely watching the trajectory of US monetary policy. Federal Reserve policymakers have recently signaled growing support for interest rate hikes in the coming months to combat persistent US inflation. This stance is expected to bolster the US dollar, which in turn acts as a headwind for raw materials.

At the close, LME copper was down 0.6% at $13,278.5 per ton.

LME aluminum fell 2.9% to $3,088 per ton.

LME nickel declined 2.3% to $16,311 per ton.

LME zinc edged up 0.1% to $3,474.5 per ton.

LME tin dropped 0.4% to $50,375 per ton.

LME lead decreased 0.5% to $1,893.5 per ton.

Precious Metals: Gold Prices Fall

Gold prices declined as the United States and Iran agreed to halt their mutual attacks. The previous attacks had tested the fragile peace agreement, casting uncertainty over when the war—which has exacerbated global inflation—might end.

Gold fell as much as 2.2%, nearing $4,000 per ounce, before paring some losses. US President Trump stated that peace talks with Iran are scheduled to restart on Tuesday in Doha.

Despite renewed signs of tension around the Strait of Hormuz, gold held above $4,000. "This suggests marginal dip-buying has returned and is willing to defend this level," said Justin Lin, an analyst at Global X ETFs Australia. "I expect gold's resilience to Middle East turmoil to grow stronger, especially now that it has fully erased its gains for the year and most short-term profit-seeking investors have likely exited."

As of 5 p.m. New York time, spot gold was down 1.8% at $4,015.91 per ounce.

Spot silver declined 1.5% to $58.257 per ounce.