Crude oil prices advanced as the elusive peace agreement between the US and Iran prolonged risks of a protracted disruption to transit through the Strait of Hormuz. Copper breached $14,000 per tonne, approaching its historical peak, driven by a demand recovery and heightened supply risks. Gold prices declined as accelerating US inflation bolstered the US dollar and Treasury yields.

Crude Oil: WTI Extends Gains Amid Stalled US-Iran Peace Efforts Crude oil prices rose with the prospect of a US-Iran peace deal remaining distant, effectively keeping the critical Strait of Hormuz closed and continuing to disrupt global energy transportation. Brent crude gained 3.4%, settling near $108 per barrel, while West Texas Intermediate (WTI) closed around $102. US President Donald Trump stated that Iran's capitulation was "only a matter of time." This followed his comment a day earlier describing the fragile ceasefire between Tehran and Washington as being "in serious condition on life support." The ceasefire, in place since early April, has held despite a recent series of escalations, including attacks on vessels. According to informed sources, Iran responded to Trump's peace proposal by demanding the US lift its maritime blockade, ease sanctions, and allow Iran to retain a degree of control over transit through the Strait of Hormuz. "The risk with the latest round of talks breaking down is that the closure of the Strait of Hormuz drags on, and the physical market tightens again as temporary factors that helped ease the shortage fade," said Arne Lohmann Rasmussen, Chief Analyst at A/S Global Risk Management. Satellite imagery indicates that oil shipments from Iran's main export terminals appear to have stalled over the past few days, marking the longest such pause since the conflict began. The country's oil exports, a vital source of economic revenue, remain a significant component of global energy supply. While there is little sign of an imminent resolution to the war, metrics indicating market strength have softened in recent sessions as refiners reduce purchases. On Tuesday, the Brent prompt time spread traded at a backwardation of nearly $4 per barrel, down from nearly $10 in early last month. Backwardation typically signals a tight market. The US Energy Information Administration (EIA) projected on Tuesday that US crude production will surge to a record 14.1 million barrels per day by 2027, as some domestic producers capitalize on higher prices to increase drilling activity. The agency also revised its global demand growth estimate for this year down to 200,000 barrels per day, from a previous forecast of 1.2 million barrels per day. WTI crude for June delivery rose 4.2% to settle at $102.18 per barrel. Brent crude for July delivery gained 3.4% to settle at $107.77 per barrel.

Base Metals Copper prices climbed above $14,000 per tonne, nearing a record high, as improving demand and mounting supply concerns offset worries that the Iran conflict could dampen global growth. Copper on the London Metal Exchange (LME) advanced as much as 1.2% to $14,106.50 per tonne, moving closer to the all-time high of over $14,500 set in January. The benchmark industrial metal's recent strong rebound is supported by multiple factors, including a demand recovery and potential threats to certain forms of copper production from tightening sulfur supplies linked to the Middle East situation. At the close, LME copper settled up 0.6% at $14,021 per tonne. LME aluminum fell 0.5% to $3,562 per tonne. LME nickel declined 1.6% to $18,952 per tonne. LME zinc rose 1.5% to $3,531.5 per tonne. LME tin dropped 1.6% to $54,812 per tonne. LME lead gained 0.5% to $1,997 per tonne.

Precious Metals Gold prices fell as US economic data showing accelerating inflation reduced the likelihood of the Federal Reserve easing monetary policy this year. Spot gold dropped as much as 2.1% following the inflation data release. Rising inflation concerns pushed bond yields higher, with traders increasing bets that the Fed could implement a rate hike before December. "Price action again shows gold is not behaving like a pure safe-haven asset at the moment, but more like a macro risk barometer, influenced by oil prices, inflation, Fed policy expectations, dollar moves, and market risk appetite," said Christopher Wong, a strategist at OCBC Bank. As of 6:15 PM ET, spot gold was down 0.4% at $4,715.13 per ounce. Spot silver was up 0.5% at $86.4582 per ounce.