(C) Valley City times

SEOUL – While gold and silver traditionally dominate the spotlight during precious metal rallies, 2025 has officially become the "Year of Copper." The industrial metal surged by more than 40% over the past twelve months, marking its largest annual gain since 2009.

According to Bloomberg on December 31, copper was trading at $12,515 per metric ton on the London Metal Exchange (LME) as of Tuesday afternoon. This follows a historic peak of $12,960 reached just a day earlier on December 30.

The Perfect Storm for "Dr. Copper"
Market analysts attribute this record-breaking rally to a convergence of geopolitical and technological factors. Key drivers include:

The AI Infrastructure Boom: The rapid expansion of data centers and artificial intelligence technologies has triggered a massive spike in demand for power grid equipment and electrical wiring.
Macroeconomic Shifts: A weakening U.S. dollar and a broader rally in the precious metals sector provided strong tailwinds for copper.
Supply Constraints & Policy: Concerns over supply shortages were exacerbated by the anticipation of additional tariffs under the Trump administration, prompting preemptive market movements.
 
Crude Oil Faces Sharpest Decline Since Pandemic
In stark contrast to the booming metals market, the energy sector faced a dismal year. International oil prices are expected to record their largest annual drop since the 2020 COVID-19 pandemic due to a persistent supply glut.

Oversupply Weighs on Prices
As of December 31, Brent crude futures for March delivery hovered around $61 per barrel, representing a nearly 18% decline for the year. Similarly, West Texas Intermediate (WTI) struggled to stay above the $58 mark.

The downward pressure is largely blamed on increased production from both OPEC+ members and non-OPEC exporters, coupled with slowing global demand. All eyes are now on the upcoming OPEC+ meeting in early January to see if major producers will implement further output cuts to stabilize the market.

Impact on Monetary Policy
The slump in oil prices serves as a "silver lining" for global central banks. Lower energy costs act as a deflationary force, helping to ease the inflation pressures that have plagued economies for years.

Financial experts suggest that the trajectory of oil prices in 2026 will be a critical factor for the U.S. Federal Reserve as it weighs further interest rate decisions. If energy prices remain low, it could provide the Fed with more breathing room to maintain or pivot its current monetary stance.