The impact on commodities due to the COVID-19 pandemic has been widespread prompting a high level of buying in some sectors and conversely a high level of selling and falling prices in other sectors.

The price of gold reached a record high of USD 2,074.88 in August of this year. Gold has traditionally been viewed as a safe haven for investors. The pandemic has caused such an upheaval in the market’s investors have fled into gold where there is much less volatility. Gold which has risen by 14.5% in the last six months is also viewed as a hedge against the fall in prices in currencies and shares.

Silver like gold is a safe haven in times of trouble and historically investors have fled to into both gold and silver.  Although silver is a smaller market than gold half of all silver purchased on a global basis is for industrial use. Silver therefore can be viewed as a more valuable asset. COVID-19 has been no exception and since April silver has risen by 52% outperforming gold by some 38%.

Oil sunk to their lowest level ever in April, first hitting USD 0.01 before hitting a negative of USD 40 per barrel. These extreme oil prices were due to oil supplies overwhelming global storage capacity and oil producers having to pay buyers to take barrelage they could not store themselves. These before unheard of prices shows how the pandemic impacted oil prices due to a slump in the global economy. Today, crude oil prices have doubled since April. However, they are still 33% lower than their pre-pandemic level.

Elsewhere the global jet fuel price has declined alarmingly. This is obviously due to most airlines being semi grounded. Between the beginning of May 2020 and the end of June 2020 scheduled flights were down an average 64.5% on the previous year. The future price for European Jet Fuel for December 2020 delivery declined to USD 370 per metric ton, losing 50%of its value. Market conditions can only improve as when airlines retake to the sky in significant numbers.

For more indepth overview please read our article – The Pandemic – A Global Overview and What the Future Holds