Global Outlooks Diverge as Refiners Profit; Copper Awaits Washington

Conflicting outlooks for global oil supply and strong refining profits are shaping the energy landscape as base metals markets shed their war premium and await a U.S. policy decision on copper, according to industry reports published Friday.

Major energy forecasters have sharply diverged in their projections for the Strait of Hormuz recovery and its impact on global oil balances. According to OilPrice.com, the International Energy Agency (IEA) and BloombergNEF (BNEF) have significantly narrowed their predicted supply deficits for 2026, now seeing shortfalls of 900,000 barrels per day and 500,000 b/d respectively, down from a 2 million b/d deficit forecast a month earlier. In contrast, the U.S. Energy Information Administration (EIA) stated it does not expect a recovery to pre-war traffic levels before early 2027, projecting global oil inventories will fall by an average of 7.6 million b/d in the third quarter of 2026. The monthly Reuters poll of oil price projections saw the average 2026 Brent forecast fall to $84.5 per barrel, down $6 from May.

Meanwhile, U.S. crude refiners are enjoying some of the best profit margins in years, according to a summary from Rigzone.

In metals markets, the premium built on Strait of Hormuz disruptions is fading, shifting focus to individual commodity fundamentals and U.S. trade policy. The London Metal Exchange Index closed the first half of the year with mixed performance across its six base metals, according to OilPrice.com. Metals with direct exposure to the Gulf conflict, like aluminum, are unwinding their war premium. Aluminum had reached a four-year high above $3,780 a ton in early June after missile strikes knocked out roughly 2 million tons of annualized regional smelter output, but most of that gain has since reversed.

Copper prices topped $14,000 a ton in June, but the commodity's next major move now hinges on Washington, not the Gulf. Commerce Secretary Howard Lutnick's review of the domestic refined copper market, due June 30, was to inform a potential tariff starting at 15% in January 2027. As of Friday, that decision had not been announced, with BNP Paribas strategist David Wilson noting opponents are “still actively and significantly lobbying to not have a tariff.”

Other metals followed their own supply-demand dynamics. Zinc, largely insulated from the war, was the first half's surprise performer, up 14% by June on an unexpected global deficit outside China. Tin rose 27% on a structural supply squeeze, while lead fell 7% on surplus. Nickel prices tracked Indonesian mining quotas more than Gulf events.

For Bakken operators and royalty owners, the diverging oil outlooks underscore continued market uncertainty, while strong refining margins represent a positive downstream signal. The pending U.S. decision on copper tariffs could have implications for industrial demand and broader trade policy affecting the energy sector.