Volatile commodities amid geopolitics and interest rates: Oil above $100, Gold uncertain

Overview of Commodity Markets

The trading day of March 20, 2026 is marked by high volatility in major commodity markets, with dynamics heavily influenced by geopolitical and macroeconomic factors. In particular, the energy sector continues to be the main driver of price movements, while precious metals show a more uncertain trend, caught between safe-haven demand and pressures stemming from restrictive monetary policies. Tensions in the Middle East, combined with expectations of higher interest rates for longer in the United States and Europe, are contributing to sustained uncertainty, directly affecting the prices of oil, natural gas, gold, and silver.

Performance of Major Commodities

Below is an updated summary of key market benchmarks:

1. Gold: $4,674 per ounce (+0.6%)
2. Silver: $52–55 per ounce (stable / slightly positive)
3. WTI Crude Oil: $94.4 per barrel (-1.2%)
4. Brent Crude Oil: $107.8 per barrel (-0.7%)
5. Natural Gas (TTF Europe): highly volatile (+20–25% in recent days)

These levels reflect a market where bullish and bearish forces coexist, generating even sharp short-term fluctuations.

Energy in Focus: Oil Between Tensions and Pullbacks

Oil remains the most closely watched commodity by financial market participants. After surpassing the $100 per barrel threshold in recent weeks, crude has recorded a slight correction today. WTI stands around $94, while Brent remains above $107—still elevated levels by recent historical standards. The recent downward movement does not signal a structural trend reversal, but rather a consolidation phase following strong gains driven by geopolitical tensions. The market continues to price in significant risks to global oil supply.

The key factor remains the Middle East, where the conflict between Iran and Israel has fueled fears of potential supply disruptions. In particular, investor attention is focused on the Strait of Hormuz, a crucial chokepoint for approximately 20% of global crude traffic. Any threat to the security of this route could trigger new price spikes. At the same time, some signs of de-escalation—including a temporary reduction in hostilities and the possibility of increased Iranian supply—have helped contain gains, leading to a partial pullback in prices.

Natural Gas: The Most Sensitive Commodity to the Crisis

While oil acts as the global thermometer of tensions, natural gas confirms itself as the commodity most reactive to geopolitical shocks. In recent days, European prices have recorded significant increases, with gains in the range of 20–25%, following attacks on energy infrastructure and liquefied natural gas facilities. The vulnerability of the global energy system, already evident in previous years, has returned to the forefront. Europe, in particular, remains exposed to potential supply disruptions despite efforts to diversify sources.

Gas volatility also reflects the regional nature of this market, which is less integrated than the oil market and therefore more sensitive to localized events. In this context, even marginal news can trigger amplified price movements.

Precious Metals: Between Safe Haven Demand and High Rates

Gold continues to move in a complex environment. Today it records a slight increase, standing around $4,674 per ounce, supported by safe-haven demand amid high geopolitical uncertainty. However, the precious metal remains under medium-term pressure, heading toward its third consecutive weekly decline. The main factor weighing on it is the expectation of higher interest rates for longer, which increases the opportunity cost of holding a non-yielding asset such as gold.

Silver follows similar dynamics, showing stable but weak performance on a weekly basis. In addition to its role as a safe haven, the metal is also affected by industrial demand prospects, which remain uncertain in a context of global economic slowdown.

Macroeconomic Factors: The Role of Central Banks

Alongside geopolitics, the second major driver of commodity markets is monetary policy. Major central banks, particularly the Federal Reserve, continue to maintain a restrictive stance to combat inflationary pressures. Expectations of higher rates impact different commodities in various ways:

1. they penalize precious metals, reducing their attractiveness
2. they indirectly support energy, through their impact on inflation
3. they strengthen the US dollar, influencing the prices of dollar-denominated commodities

A strong dollar represents an additional pressure factor for many commodities, making them more expensive for international buyers and contributing to limiting demand.

Key Market Drivers

In summary, the factors most influencing commodity market trends can be outlined as follows:

1. Geopolitical escalation in the Middle East
2. Risks to global energy supply
3. Attempts at de-escalation and political interventions
4. Restrictive monetary policies
5. Strength of the US dollar

These elements interact with each other, creating an environment of high uncertainty and volatility. Looking ahead to the coming weeks, the commodity market appears set to remain unstable. Oil could continue to fluctuate within a wide range between $90 and $120 per barrel, depending on geopolitical developments. Natural gas presents the highest volatility risks, with potential for further spikes in case of additional supply disruptions. In contrast, precious metals may remain in a sideways phase, caught between safe-haven demand and pressure from high interest rates.

Andrea Pelucchi