Commodity markets witnessed sharp volatility on Monday, March 9, as energy prices surged while precious metals and some base metals declined amid escalating geopolitical tensions in the Middle East.
On the Multi Commodity Exchange (MCX), silver was trading at Rs 262,675 per kg, down Rs 5,610 or 2.09%, while gold futures were at Rs 160,300 per 10 grams, falling Rs 1,334 or 0.83% during the session. The decline in precious metals came despite global uncertainty, reflecting profit booking and strength in the US dollar.
Among base metals, copper futures slipped 1.22% to Rs 1,182.65, declining Rs 14.55 during the session. Meanwhile, zinc showed marginal strength, rising 0.17% to Rs 324.40, while aluminium gained 2.66% to Rs 348.95.
Crude oil and natural gas surge sharply
Energy commodities recorded the biggest gains in the session. Crude oil futures jumped nearly 18% to Rs 9,868, gaining Rs 1,505 as global supply concerns intensified.
Natural gas also surged 8.90% to Rs 321.9, rising Rs 26.3 during the session as fears of supply disruptions supported prices.
Geopolitical tensions driving commodity moves
The sharp rally in energy prices follows rising tensions in West Asia, which have raised concerns over disruptions to global oil and LNG supply routes. The Strait of Hormuz, a key shipping corridor for global oil exports, has become a major focus for markets as any disruption in this route could significantly affect global energy supply.
The surge in crude oil prices has also fueled inflation concerns globally, putting pressure on other asset classes including equities and precious metals.
While gold typically benefits from geopolitical risks, the current rally in energy prices and the strengthening US dollar have weighed on bullion prices in the short term. Market participants are also closely monitoring central bank policies and global economic growth outlook amid the volatile commodity environment.
Commodity markets are expected to remain highly sensitive to geopolitical developments and supply disruptions in the coming sessions.
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