Precious metals in deep red, oil falling: commodities market under crossfire from Donald Trump and Xi Jinping

Developments in US-China trade relations and market dynamics are affecting the prices of major commodities.

As of October 27, 2025, the prices of key commodities show a clear decline, with oil, gold, and silver under pressure. Among the main factors are developments in political and trade relations between the United States and China, which continue to drive market sentiment.

Precious metals have faced downward pressure: gold fell below $4,050 per ounce (-2.26%), silver under $48 (-2.62%). This sharp decline is due to several factors: optimism about trade negotiations reduced demand for safe-haven assets, driving investors toward riskier assets; the strengthening dollar made gold and silver more expensive for buyers outside the United States; and many traders took advantage of previous highs to take profits.

Oil has also experienced a significant drop: Brent fell below $65 per barrel. This movement was mainly influenced by rising supply, driven by OPEC+ production and expectations of weaker demand. Initially, progress in trade agreements between the two largest global consumers had supported prices, but optimism was balanced by concerns over potential oversupply and weaker global demand.

"The market is positioning itself in a ‘risk-on’ mode" - explains the trading desk at Ucapital - "Safe-haven assets, from gold to commodities, are being sold to increase exposure to equities." The trend is expected to continue until a new framework trade agreement between Washington and Beijing is formally confirmed.

In conclusion, the drop in commodity prices is largely due to a combination of political and trade dynamics between the world’s two largest powers. While trade agreements initially supported prices, concerns over oversupply and weaker global demand prevailed, driving the observed downward trend.