In the commodities asset class, in May 2026, ICE cocoa futures were the only commodity to post a percentage gain just below double digits. Palladium, WTI, Brent crude oil, gasoline, heating oil, crack gasoline spread, frozen concentrated orange juice, and Ethereum declined more than 10%. Major stock indices rose, while long-term bond futures were stable. The dollar index rose 0.95%. Long-term bond futures fell 0.47%. A higher dollar and high interest rates weighed on prices of many commodities.
Oil remains in focus
A continuing ceasefire and hopes of a deal between Iran and the United States that would open the Strait of Hormuz, a critical logistical bottleneck for crude oil, pushed down prices for crude oil, petroleum products, crack spreads and fertilizers in May.
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The monthly NYMEX WTI crude oil futures chart for July shows the price fell 11.88% in May. Brent crude oil, the benchmark for Middle Eastern oil, kept pace with WTI, posting a monthly drop of 11.84% in the August ICE contract.
Gasoline futures fell 11.98%, while heating oil futures, which are an indicator of other distillate fuels, fell 10.28%. Heating oil futures slightly outperformed gasoline futures, even as the energy market moved into the 2026 driving season, the peak season for gasoline demand.
Crack spreads reflect refining margins for processing crude oil into gasoline and distillate products. The gasoline crack differential fell 12.81% in May, while the distillate crack differential registered a drop of 8.10%.
Chicago July swaps for ethanol, the biofuel additive to U.S. gasoline, rose 0.61% on the month, while coal for delivery in Rotterdam, Netherlands, rose 8.30% in May, even as heating demand slowed during the spring. Meanwhile, US natural gas futures prices for July rose 8.08% as natural gas enters the cooling season. Natural gas prices in Europe remained stable due to the upcoming cooling season and concerns about supply in the Middle East. Natural gas futures prices in the United Kingdom for July delivery rose 0.15% in May, while natural gas futures prices in the Netherlands for July delivery rose 0.40% during the month ending May 29. The Middle East continued to cause supply concerns.
Precious metals mostly fell, while copper hit a new record in May
Precious metal prices soared in 2025 and early 2026, but lost bullish strength in late January.
Gold, the main precious metal, fell 1.53% in May. The volatile silver futures market rose 2.50%. NYMEX palladium futures fell 11.26%, leading the downward trend, while NYMEX platinum futures fell 3.26%.
Copper, the leading non-ferrous metal, saw a gain of 6.83% in the nearby futures contract. July COMEX copper rose to a new record of $6.7160 in mid-May, while base metals rose in May.
The quarterly chart highlights copper’s bullish trend that took the red metal to a new all-time high in May 2026.
LME three-month copper forwards rose but remained below their all-time high in January 2026. LME three-month aluminum forwards rose, LME nickel forwards fell, LME lead forwards rose, LME zinc prices rose and LME tin forwards also posted an impressive gain.
Cereals and soft materials mostly fell, and sawn wood rose
The growing season in the northern hemisphere is already underway. However, grain and oilseed markets have faced a shortage of fertilizers as the Strait of Hormuz is a logistical bottleneck for this critical agricultural input. November new crop soybean futures prices rose 1.45%, while December new crop corn futures fell 3.89% and September CBOT soft red winter wheat futures fell 4.33%. With Russia and Ukraine being major wheat producers, the ongoing war had pushed up wheat prices, but fertilizer prices and supplies probably provided the biggest support to grain and oilseed prices in the past two months. However, prospects for an end to the conflict caused corn and wheat prices to decline in May.
There was little change in physical lumber futures in May, causing the July futures contract to rise just 0.09%.
The 2026 peak grilling season arrived at the end of May. Livestock prices have reached record levels, but declined in May. Live cattle and feeder cattle futures for August delivery fell 3.87% and 6.72%, respectively, in May. Meanwhile, lean hog futures for August delivery decreased 9.10% for the month.
Soft commodities releases were mostly lower in May, with global cocoa and sugar futures up 9.92% and down 3.76%, respectively. Cotton, which had seen an increase of almost 14% in April, fell 7.36% in May. Arabica coffee futures fell 6.99%. Volatile FCOJ futures led the decline with a 16.29% drop in May.
Focus on gold and silver: a buying opportunity?
Since hitting all-time highs in late January, COMEX gold and silver futures have corrected to lower highs.
The chart shows that after reaching an all-time high of $5,706 on January 29, 2026, gold corrected 27.1% to a low of $4,162 per ounce on March 23. While August COMEX gold futures settled near $4,595 per ounce on Friday, May 29, it remains in a bearish trend, posting lower highs and lower lows since late January.
The chart highlights that after reaching an all-time high of $123.45 on January 29, 2026, July COMEX silver futures corrected 50% to a low of $61.66 on March 23. While silver was trading near $76 per ounce on Friday, May 29, it remains in a bearish trend, posting the lowest highs and lowest lows since late January.
Meanwhile, long-term charts remain in uptrends, despite corrections.
Gold’s bullish trend since 1999 remains firmly intact, with first technical support at the third-quarter 2020 high of $2,089.20 per ounce.
Silver’s uptrend since the first quarter of 2020 remains firmly intact, with first technical support at the 1980 high of $50.36 per ounce.
JPMorgan analysts forecast gold will reach $6,000 an ounce in the second half of 2026. UBS expects gold to reach $5,500 this year, while Bank of America forecasts a target of $6,000. Goldman Sachs is slightly more conservative, with a target of $5,400 per ounce.
The bottom line is that major financial institutions believe gold will rise substantially from its current level of $4,593 per ounce in the August futures contract. If gold is to take off higher and challenge its late January 2026 high, silver is likely to follow. Therefore, buying gold and silver at current prices could be a golden opportunity later this year.
Factors to take into account in June 2026
As commodities head into June, they face major developments in the economic and geopolitical landscape. Seasonality favors a certain strength in grains, meats and gasoline. The situation in the Middle East will continue to dictate the path of least resistance for energy and other commodity prices. The 2026 barbecue season is already underway, which could support beef and pork prices after declines in May. Cryptocurrencies have been consolidating and could rise or fall in the coming weeks. The upcoming midterm elections in the United States could begin to affect markets in the coming weeks and months.
Keep an eye on those metals as gold and silver remain in long-term uptrends. The continued decline in the purchasing power of fiat currencies remains a factor supporting metals and all commodities.
The bull market in stocks continues, but the economic and geopolitical outlook will determine the path of least resistance for US stocks. Bonds have not broken out of their long-term consolidation pattern, but interest rates remain elevated. Interest rates could fall if oil prices continue to decline. Lower oil prices should ease inflationary pressures, setting the stage for another Fed rate cut under new Chairman Kevin Warsh.
Expect continued volatility in the commodities asset class in June 2026 and beyond, and you won’t be surprised or disappointed.
On the date of publication, Andrew Hecht had no (directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are for informational purposes only. This article was originally published on Barchart.com
