Weekly Pricing Pulse: Conflict Calms And Oil Prices Calm With It

• The Material Price Index (MPI) by S&P Global Market Intelligence edged down last week, falling 0.2%.
• The decrease was narrow, with four of the ten subcomponents declining.
• Energy markets remain the main story for the MPI, as the subindex declined 3.7%. 
• Market sentiment was tentatively positive last week.

Market sentiment was tentatively positive last week. Ceasefire in the Middle East, combined with Iran’s response to the US attack over the previous weekend, curbed worries that oil flow would be disrupted.

The halting of trade negotiations with Canada at the end of last week was not enough to undo gains throughout the week, leading to the S&P 500’s first intra-day peak since February.

The Bureau of Economic Activity released an estimate of first quarter real GDP growth showing a 0.5% contraction. S&P Global Market Intelligence estimates second quarter real GDP growth at 1.3% — an improvement, but still below-trend. While the agreement with mainland China — which reduced reciprocal tariffs to 10% — was signed last week, industrial production remains weak, with May seeing year-to-date industrial production fall by 1.1% year over year.

As tariff resurgence fast approaches, risk shifts to the upside in the coming weeks.

The Material Price Index (MPI) by S&P Global Market Intelligence edged down last week, falling 0.2%. The decrease was narrow, with four of the ten subcomponents declining. The MPI is approximately 8.4% lower than it was the same week a year ago, indicating a general easing in commodity prices over the past 12 months.

Energy markets remain the main story for the MPI, as the subindex declined 3.7%. This was led by oil, which saw an 8.8% decline — its second strongest weekly decline since early 2022. Markets saw Iran’s response to the US’s bombing of its nuclear facilities as deescalating, and as an indication that Iran would avoid attempting to limit oil exports in the region. The ceasefire, albeit tenuous, further eased fears, bringing prices back down to around $67/barrel for Brent crude — around $2/barrel higher than they were before Israel’s mid-June strikes.

The nonferrous metals subindex rose 2.1% last week. Copper prices rose by 1.8%, to a weekly average of $9987/metric ton – its highest value since June 2024. This increase comes as the expiration of the US’s 90-day pause on its retaliatory tariffs is soon approaching. This is prompting advanced buying, boosting demand in the short run.

—By Gregory Muller

This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.