March 2, 2022
Prices of commodities linked to Russia and/or Ukraine are going wild in Tuesday trading, creating havoc for investors. Commodities could become a bigger headwind for investors if prices remain elevated and if volatility persists at these high levels.
The commodity markets that Russia impacts the most are oil, natural gas, aluminum, titanium, and wheat.
Benchmark U.S. crude oil prices are 9% in late trading Tuesday, breaking the $100-per-barrelbarrier.
Russia, of course, is a large oil producer. The country pumps out about nine million barrels of crude oil a day. The U.S., for comparison, pumps out about 11.6 million barrels. Daily global oil production runs to roughly 78 million barrels, according to Bloomberg data.
Russia is also a huge producer of natural gas, pumping out about 639 billion cubic meters in 2021. Global natural-gas production came in at about 3.854 trillion cubic meters. Russias influence in regional natural-gas markets are a big reason prices are spiking. Some European natural-gas prices spot prices are up 35% Tuesday.
Aluminum prices have risen about 3% over the past five days, and are up about 20% year to date.
In 2021, global production of titanium sponge, a raw form of the metal, amounted to about 210,000 metric tons. Russia produced about 27,000 metric tons.
Benchmark wheat prices are up about 19% over the past five days and are up about 30% year to date. Prices are now north of $10 a bushel, and havent been this high since 2008.
OneProSpecial Analyst
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