MacroVoices #529 Ole S Hansen: Commodities in The Wake of The Iran Crisis

In this episode of MacroVoices, host Eric Townsend interviews Ole Hansen, head of commodity strategy at Saxo Bank, about the sweeping market implications of the Iran-driven energy crisis. The conversation spans crude oil, refined products, fertilizers, agriculture, copper, gold, and cotton, with Hansen arguing that the disruption is far more profound than front-month oil prices suggest.

Hansen opens by emphasizing that the crisis is not merely an oil story. The Middle East has become a major hub for energy-intensive commodity production — including aluminum, fertilizers, helium, and sulfuric acid — due to abundant cheap energy from the Persian Gulf. This means the conflict is rippling into metals and agricultural markets in ways many investors have not yet appreciated. For example, 50% of the sulfuric acid used by copper miners in South America comes from the Middle East, threatening copper supply chains.

On crude oil specifically, Hansen argues that the forward curve — while showing extreme backwardation — is not fully reflecting the long-term damage. He contends that a new structural price floor has been established roughly $10-$15 higher than pre-crisis levels, suggesting Brent crude around $80 is where the new floor sits rather than the prior $60-$75 range. He also notes that U.S. shale producers have added zero new rigs and zero new barrels since the conflict began, partly because the backwardated curve makes hedging future production unattractive, and partly because U.S. production may be approaching a saturation point.

A substantial portion of the interview is devoted to explaining how commodity term structure — specifically backwardation versus contango — dramatically affects investor returns independent of spot price movements. Hansen uses Bloomberg Commodity Index data to show that from 2021 to 2026, the total return index was up 83% versus the spot index's 57%, illustrating how backwardation generates meaningful roll yield that compounds investor returns. He contrasts this with the 2016-2021 period when contango eroded returns, turning a 52% spot gain into only a 14% total return.

On fertilizers and agriculture, Hansen warns that the planting season is underway in the Northern Hemisphere with significantly reduced fertilizer availability, creating a real risk of below-average crop yields later in 2026 and into 2027. He notes that nitrogen-intensive crops like wheat are most at risk, while soybeans are least affected. He describes agricultural markets as mostly still in contango, meaning the trade opportunity is not yet as clean as in energy, but flags December corn and wheat and November soybeans as the futures contracts that would capture this year's harvest outcome. He also notes that the fertilizer shock's most acute near-term impact may be on regions closer to the Middle East — India, Africa, and eventually South America.

For copper, Hansen highlights that exchange-monitored inventories had been building but are now falling sharply in China, signaling pent-up demand returning after the price correction. He also flags the sulfuric acid supply disruption as an underappreciated constraint on copper mining output, adding a supply-side dimension to copper's already constructive demand story driven by electrification and energy transition.

On gold, Hansen describes the sharp selloff from January highs — approximately $1,500 — as a classic panic-driven liquidation of a widely-held asset, similar to gold's initial response during prior crises like the dot-com bubble and the global financial crisis. He sees gold consolidating near the 50% retracement of the selloff and the 200-day moving average, with the longer-term bull case intact but near-term direction dependent on whether inflation or growth concerns dominate. He flags $4,600 as a level where he would become more cautious.

The episode also covers cotton — which Hansen links to petrochemical-derived synthetic fiber competition — cocoa's dramatic boom-and-bust cycle driven by supply shocks and demand destruction, and the broader secular commodity supercycle, which Hansen argues may be only halfway through its current leg, driven by the energy transition's enormous commodity intensity.

In the postgame segment, Patrick Ceresna presents a Trade of the Week using a bull call spread on December 2026 WTI crude oil futures, buying the $70 call and selling the $90 call for a net debit of approximately $7.30, designed to capture upside repricing with defined risk and minimal time decay. Ceresna and Townsend also discuss equity markets — where a 23-day April rally has pushed prices to overbought levels ahead of major tech earnings — as well as ongoing dollar dynamics, uranium miners, and the 10-year Treasury yield's correlation with crude oil prices.