Tension returns to the energy markets following the renewed closure of the Strait of Hormuz

In last week's article: "Reopening of the Strait of Hormuz: financial markets optimistic about the developments in the conflict in Iran", the sharp decline in energy prices following the reopening of the Strait of Hormuz was highlighted, with Brent and WTI closing at 90 $/barrel and 83.8 $/barrel respectively.
However, the reopening on Friday, April 17, proved to be very short-lived, as by Sunday the strait was already closed again. The closure was ordered by Iran in response to the seizure of an Iranian vessel by the United States, which continued to maintain the naval blockade on Tehran’s ports and ships, making its removal conditional on reaching an agreement.

The renewed escalation of geopolitical tensions supported the rebound in energy prices, which thus recovered the declines recorded in the previous week. The recovery occurred progressively במהלך the week, in a context characterized by the absence of concrete progress in negotiations between the United States and Iran. Not even the extension of the ceasefire managed to contain the rise in prices, with the Strait of Hormuz still closed and Iran seizing oil tankers and cargo ships in transit. Brent thus returned to 105 $/barrel, while WTI closed at 94.4 $/barrel. European natural gas also followed a similar trend to oil, with the TTF rising to 52.5 euros per MWh.

Although the energy market is currently heavily influenced by geopolitical news, a prolonged closure of the Strait of Hormuz could gradually reduce its sensitivity to further developments of this kind. As the situation persists, recovering lost production becomes increasingly complex, increasing the likelihood that prices will remain high for a long time even after a potential reopening of the strait.

Another sector significantly affected by the closure of the Strait of Hormuz was that of precious metals. Gold and silver recorded a weekly decline in prices, driven by increased inflation expectations linked to rising energy costs. In particular, gold closed the week at 4 722 $/ounce, while silver returned to 76.4 $/ounce.

In contrast, industrial metals continued their upward price trend. Among ferrous metals, generalized price increases were observed in China, compared to a more sideways trend in Europe. In the non-ferrous segment, a different dynamic emerged, with prices broadly stable on the Shanghai exchange and rising on the London exchange.
On the London Metal Exchange (LME), copper remained above 13 000 $/ton, not far from its January record highs; aluminum nearly reached 3 700 $/ton, reflecting the fragility of the Middle East truce and permanent damage to production infrastructure; and nickel exceeded 18 600 $/ton. The rise in nickel prices is supported by the new forecast from the International Nickel Study Group (INSG), which expects a market deficit in 2026, linked both to production quota restrictions in Indonesia and broader repercussions of geopolitical tensions in the Middle East.

In the food sector, a generalized increase in prices was recorded, more pronounced for tropical commodities. The most significant increase concerns coffee prices, supported by persistent tensions in the Middle East, which continue to put pressure on logistics costs in a context where exchange-held stocks remain at low levels.

Purchasing Managers Index

Europe

In April, the Eurozone flash composite PMI fell to 48.6 from 50.7, dropping below the 50-point threshold that separates expansion from contraction in economic activity. The deterioration was mainly driven by services, which fell sharply to 47.4, weighed down by uncertainty and weakening demand linked to rising energy prices.
Manufacturing, on the other hand, showed an unexpected improvement to 52.2, likely supported by a temporary increase in orders and inventory rebuilding by firms seeking to prevent potential supply disruptions and further input cost increases. However, this support may prove temporary, as suggested by worsening expectations for future activity.
Overall, the picture indicates a weakening of activity in the euro area, with cost pressures still rising and early signs of pass-through to final prices.

USA

April PMI data for the United States indicate an overall improvement in economic activity, albeit in a context of still uneven growth across sectors.
The composite PMI rose to 52, recovering from near stagnation in March, indicating a return to a more solid expansion phase for the US economy. The improvement was mainly driven by the manufacturing sector, whose PMI rose to 54, the highest level in several years, signaling a strong acceleration in industrial activity supported by increased demand linked to the need to rebuild inventories. The services sector showed more moderate growth, with a PMI of 51.3.
Overall, April PMIs highlight a US economy still in expansion, mainly supported by the recovery of the manufacturing sector.

ENERGY

The PricePedia financial index of energy products shows a price recovery due to the renewed closure of the Strait of Hormuz.

PricePedia Financial Index of energy prices in dollars

The energy heatmap highlights a significant increase in oil and natural gas prices.

HeatMap of energy prices in euros

PRECIOUS METALS

The financial index of precious metals shows a price decline, attributable to rising inflation expectations.

PricePedia Financial Index of precious metals prices in dollars

The heatmap analysis shows a generalized decline in financial prices of precious metals.

HeatMap of precious metals prices in euros

FERROUS

The European ferrous metals financial index follows a mostly sideways weekly trend, while the Chinese one continues its price growth.

PricePedia Financial Indices of ferrous metals prices in dollars

The heatmap analysis shows rising prices for Chinese stainless steel coils and rebar.

HeatMap of ferrous prices in euros

NON-FERROUS INDUSTRIAL

Among non-ferrous metals, prices rose on the LME and slightly declined on the Shanghai exchange.

PricePedia Financial Indices of non-ferrous industrial metals prices in dollars

The non-ferrous heatmap shows a generalized increase in zinc, aluminum alloys, and nickel prices.

HeatMap of non-ferrous prices in euros

FOOD

All three food financial indices show weekly growth, particularly the tropical products index.

PricePedia Financial Indices of food prices in dollars

CEREALS

The cereals heatmap shows a decrease in oat prices and an increase in wheat and corn prices.

HeatMap of cereal prices in euros

TROPICAL

The tropical heatmap highlights the weekly increase in coffee prices.

HeatMap of tropical food prices in euros

OILS

The edible oils heatmap shows a generalized increase in prices, more pronounced for soybean oil.

HeatMap of edible oils prices in euros