Top 5 Commodities to Watch in May 2026
Reading time: 4 minutes
As of today, the ongoing US-Iran conflict continues to stifle one of the world’s most critical energy pipelines, the Strait of Hormuz, through which roughly 20% of the global oil supply flows. In effect, this has triggered a number of events like supply shocks, inflation, and even the reinvigorated focus on commodities trading as both a hedge and an option.
For any discerning trader, geopolitical tensions such as the events in the Middle East aren't part of the typical cycle: It is a volatile market where supply challenges, military tensions, and macro-liquidity are interacting in real time. It is no longer a question of whether commodities will move, but a question of which commodities to trade and how to position around such risks.
In today’s blog, we round up the top performing commodities to watch in May 2026, with notes grounded in current market dynamics and beyond:
1. Oil
Recent events show that energy supply can indeed be weaponised. Since the end of February, the heightened tension between the US and Iran has pushed Brent crude oil above 100 dollars, with some experts cautioning of a potential spike of 150 dollars in worst-case scenarios.
From a commodities trading perspective, crude oil provides 3 distinct opportunities:
- Physical disruption - When it comes to oil, even minor interruptions to shipping routes and/or production plants can delay millions of barrels per day from the market.
- Anticipatory pricing - This is the strategic practice of traders bidding up futures contracts based not on actual supply loss, but on expected escalation.
- Policy response - Cascading from OPEC+ and strategic petroleum reserves, which can dampen or amplify price movements.
What’s more compelling about oil is the feedback loop between price and macroeconomics: higher oil prices drive up costs of essential goods. This inflation shock influences and prompts central bank policy. The resulting policy then affects local currency strength (or lack thereof), which circles back into commodity prices.
Traders may see layers of trading options in such scenarios. Breaking news can sometimes prompt momentum trades, but while they may be profitable, these trades have to be carried out with precision. Meanwhile, longer term positioning must account for the possibility of demand destruction if prices remain high for a longer period of time.
Is oil one of the top performing commodities today? Yes, and it could be one of the macro anchors of the commodities complex in 2026.
2. Gold
Traditionally, geopolitical conflicts drive investors to invest in more gold as a store of value. In the context of the US-Iran conflict however, competing forces appear to complicate this narrative. On one hand, economic uncertainty and inflation support gold price hikes. On the other hand, a strong US dollar exerts downward pressure. This tension between both safe havens resulted in sudden pricing movements. The value of gold jumps up on escalation headlines, but falls when liquidity tightens or when capital is thrown back into USD-denominated assets.
For those engaged in commodities trading, this presents a different kind of opportunity. Gold is no longer a passive hedge, but an active trading instrument that reflects the push and pull between fear and liquidity.
3. Silver
Silver falls squarely within the ‘goldilocks zone’ amid escalating military tension in the Middle East. It’s at the intersection of monetary policy and industrial demand, which makes it one of the most dynamic assets in commodity markets today.
Gold price moves primarily due to macroeconomic factors, but silver also reacts due to demands of the industry, especially in its wide applications in electronics, solar panels, and energy infrastructure. This year, the demand for silver and other precious metals might be more palpable as geopolitical uncertainty persists. In percentage terms, silver can even outpace gold during bullish phases. Traders also look at the gold-silver ratio, which they use to identify relative value opportunities.
When there is stronger economic activity or ‘reflation’, silver generally outperforms gold. Furthermore, silver’s volatility tends to overshoot in both directions, an attribute that makes it attractive for traders who are not so risk-averse.
4. Copper
In 2025, the world saw growing demand for copper, driven by multiple sectors such as transportation, renewables, and data centers, resulting in a supply deficit entering this year.
According to the Bloomberg report, the copper market is likely to face acute long-term pressure as copper intensive data centers grapple with low supply because of mining disruptions as well as slow permitting. This tightening will likely drive up copper prices, even amid the boom of electrification projects such as production of electric vehicles, grid expansion, and manufacturing of batteries.
5. Natural Gas
Oil may well be the stuff of headlines nowadays, yet natural gas has seen even sharper percentage moves.
Since the US-Iran conflict escalated this year, prices for liquefied natural gas (LNG) have surged dramatically, as vulnerable countries scramble and look for other energy alternatives. Compared to oil, natural gas is highly regional and its price can vary per location. For example, the US-Iran war amplified the price fragmentation of LNGs between Asia, Europe, and North America due to infrastructure challenges and storage levels. More countries scramble to secure LNG shipments, which even bid up its price in competitive markets.
Experienced traders can take advantage of this sharp dislocation in LNG prices. When there’s not much oil to go around and oil becomes too expensive to secure, power producers may opt to use natural gas instead. This revitalises a whole new supply-demand dynamics for natural gas, where low inventories or storage levels can trigger sudden price movements of said resource.
If you’re looking for alternative commodities to trade, natural gas could be an option due to its high volatility, albeit it behooves investors to have a deeper understanding of regional market behaviours.
What makes 2026 unique isn’t just the geopolitical conflict between Iran and US and its allied states, it’s how said conflict is interacting with forces that move in an already fragile global market. In such a fraught economic environment, commodities trading is less about static strategy and more about dynamic positioning.
Trading Commodity CFDs with FP Markets
Commodity Contracts for Difference (CFDs) allow traders to speculate on the price movements of raw materials such as gold, silver, oil, copper, and natural gas without owning the underlying asset. CFDs enable traders to potentially profit from both rising and falling markets by trading on price fluctuations through leveraged positions.
As commodity markets can experience significant volatility, implementing effective risk management strategies, such as stop-loss orders, disciplined position sizing, and careful market analysis, is essential when trading CFDs.
FP Markets, an established broker, offers access to a wide range of commodity CFDs through cutting-edge trading platforms including MetaTrader 4, MetaTrader 5, cTrader, and TradingView, alongside competitive spreads and fast execution. Open a trading account with us today and start exploring global markets.
