Goldman Sachs says commodity cycle is shifting from oil to metals

Goldman Sachs's The Goldman Sachs Group, Inc. ↘ 0.66% commodities team published a note on Sunday evening arguing that the era of supply shocks in raw materials will persist well beyond the historic disruption caused by the Iran war, with demand increasingly anchored in metals critical to artificial intelligence infrastructure, electrification, and defense spending rather than traditional oil and gas.

"Gold is not done," wrote Samantha Dart, co-head of global commodities research, reaffirming the bank's $4,900 per troy ounce year-end 2026 gold forecast and pointing to emerging-market central bank diversification — accelerated since the 2022 freezing of Russian reserves — as the structural driver.linkedin+1

From Oil Shock to Metals Demand

The note arrives as global energy markets begin to normalize following what Brookings described as "the largest disruption in the history of the oil market," when the closure of the Strait of Hormuz during the U.S.-Iran conflict removed roughly 14 percent of global crude production from circulation. A ceasefire and a June deal to reopen the strait have sent oil prices retreating from wartime peaks above $120 per barrel, with Goldman forecasting Brent to average $75 in 2027.brookings+1

But the bank's commodities team sees the more durable investment story shifting toward metals. Goldman raised its end-2026 copper forecast in early June by more than 10 percent to $13,735 per metric ton, citing weaker-than-expected mine supply growth and robust demand from electrification, AI data center buildouts, and grid expansion. The bank also revised downward its projection for global mine output this year.seekingalpha+1

Structural Tailwinds From AI and Defense

Goldman recommended investors maintain diversified commodity exposure, noting that Asian equities and commodities share structural tailwinds from AI power infrastructure and defense spending. Daan Struyven, Dart's co-head of commodities research, separately argued that the Iran war's oil shock is accelerating electric vehicle adoption, which will ultimately depress crude demand by up to 0.32 million barrels per day by late 2027.businessinsider+2

Year to date, gold is down more than 6 percent after reaching a record high in late January, while copper prices remain elevated following the bank's upward revision. Goldman's broader message is that the commodity cycle is rotating — away from the oil-centric shocks of the past and toward metals underpinning the energy transition and the AI buildout.finance.yahoo+1