Daily round-up: Base metals decline; oil extends losses on easing tensions

• CTA long liquidation weighs on copper price momentum.
  
  
• Continuous dollar strength pushes aluminium to four-month low.
  
  

Base metals on the London Metal Exchange (LME) traded mostly lower on 1 July 2026, with zinc leading losses, declining 1.5% d-o-d to $3,500/t, followed by copper, which eased 0.57% to $13,300/t. Lead and aluminium also slipped 0.48% and 0.32% to $1,866/t and $3,076/t, respectively, while nickel was the only gainer, rising 0.42% to $16,355/t.

On the inventory side, copper stocks recorded the sharpest decline, falling 1.16% d-o-d to 329,225 t, followed by zinc, down 0.58% to 119,825 t. Aluminium inventories declined 0.51% to 303,675 t, while lead stocks increased 0.13% to 297,375 t and nickel inventories remained broadly unchanged at 274,440 t. The continued drawdown in copper inventories suggests that underlying physical demand remains supportive despite weakness in prices.

Domestic market overview

India's non-ferrous scrap market remained under pressure on 1 July. Aluminium tense scrap (loose), ex-Delhi, declined by INR 5,000/t, or 1.32% d-o-d, to INR 375,000/t, while ex-Chennai prices fell by INR 20,000/t, or 5.17%, to INR 367,000/t, tracking weakness in global aluminium prices.

Meanwhile, copper armature scrap (Cu 99%), ex-Delhi, remained unchanged at INR 1,200,000/t amid subdued demand, as traders awaited a price recovery while maintaining sufficient inventory levels.

Oil prices extend losses as Iran peace talks improve sentiment

Global crude oil prices declined on 2 July 2026, with Brent crude falling 3.06% d-o-d to $70.90/bbl, while WTI crude dropped 2.57% to $67.90/bbl. Natural gas eased 1.72% to $3.20/MMBtu, while the US dollar index edged up 0.05% to 101.33.

Oil prices remained under pressure as optimism surrounding the ongoing US-Iran negotiations continued to reduce geopolitical risk premiums. Brent crude, which fell nearly 21% in June, recorded its steepest monthly decline since March 2020, while WTI dropped more than 20%, marking its weakest monthly performance since late 2021. The market was encouraged by positive progress in indirect talks held in Qatar, with expectations that oil flows through the Strait of Hormuz, which handles around 20% of global oil trade, will continue to normalize.

Other updates

Copper upside capped as US tariff decision delayed

Copper prices remained under pressure after the June 30 deadline for the US Section 232 investigation on refined copper imports passed without an official tariff announcement. According to sources, the absence of an update removed a key near-term supply risk, prompting commodity trading advisors (CTAs) to liquidate around 13% of their historic net long positions, weighing on short-term price momentum.

While the continued threat of future tariffs and fragmented global inventories are expected to provide underlying support to copper prices, analysts noted that a softer demand outlook is likely to limit further upside in the near term.

Aluminium prices hit four-month low amid stronger US dollar

Aluminium prices fell to their lowest level since mid-February as a stronger US dollar and easing geopolitical tensions continued to weigh on market sentiment. The metal has declined 16% in June, marking its largest monthly loss since 2008, as the easing of Middle East supply disruptions reduced concerns over global shortages.

The US dollar has strengthened 2.5% over the past two months amid expectations of a more hawkish Federal Reserve, making dollar-denominated commodities more expensive for overseas buyers. Market sentiment was also dampened as some Chinese investors shifted funds from commodities to equities following a rally in domestic stock markets, while traders continued to await the outcome of the US review into refined copper imports.