Energy, Agriculture, and Gold Shift Sharply Amid 2025 Trade Tensions

Oil and Gas Prices Decline as Economic Fears Mount

Commodity-linked sectors are navigating turbulent waters this week, as fresh forecasts and ongoing geopolitical strains push energy and agricultural markets into a reactive stance. According to the World Bank’s April 2025 Commodity Markets Outlook, total commodity prices are projected to fall 12% this year due to sluggish global demand and intensifying trade barriers. Energy prices are expected to take the steepest hit, with Brent crude projected to average $64 per barrel in 2025—down sharply from $81 in 2024. (World Bank Press Release)

Oil markets reflect that grim outlook. Brent crude futures dipped to $65.42 per barrel, while U.S. West Texas Intermediate fell to $61.65, driven by fears of oversupply and weakening demand from China. Barclays cut its Brent forecast to $70 per barrel for 2025, citing tariff-related disruptions and softening industrial output. Liquefied natural gas (LNG) demand in Asia also dropped in April, especially from China, where economic challenges and elevated spot LNG prices have curbed imports.

As energy demand falters and global shipping slows under the weight of trade disputes, expectations of a surplus build-up are growing. Market analysts warn that unless there is a reversal in trade tensions or a significant fiscal intervention, energy commodities could remain under pressure into the second half of 2025.

Agriculture and Gold React to Trade War Shockwaves

Meanwhile, agricultural commodities have been heavily impacted by the ongoing U.S.-China trade war. China’s retaliatory tariffs of 125% on U.S. agricultural goods have slashed American exports of key staples like soybeans and pork. USDA figures show Chinese soybean purchases plunged from 72,800 tons to just 1,800 tons in the last week alone, dealing a major blow to U.S. farmers. Concerns are mounting that these disrupted flows could have lasting effects on global food supply chains and farmer viability. (Wall Street Journal Report)

Gold, on the other hand, is benefiting from the rising uncertainty. Seen as a safe haven in volatile markets, gold reached a record $3,500 per troy ounce on April 22. European investors funneled over €1 billion into gold exchange-traded commodities (ETCs) in mid-April, the highest inflow since January. The surge is a direct response to fears surrounding the U.S. tariff escalation and potential capital controls, with many seeking refuge from equity market instability. (Financial News London)

From oil to soybeans to gold, commodities are reflecting a broader shift in sentiment—one that underscores a global economy navigating deep uncertainty. With further economic data and central bank reactions still to come, price volatility may only increase in the weeks ahead.