05.01.202613:30:08UTC+00Palladium Hits Weekly High on Geopolitical Tensions

Palladium futures have climbed past $1,720 per ounce, nearing a one-week peak, fueled by increasing geopolitical tensions in Venezuela. The recent capture of Venezuelan President Nicolas Maduro and his wife by the US has intensified political instability, thus driving investors towards the safe haven of precious metals. Notably, over 80% of palladium demand stems from its use in catalytic converters for gasoline engines. The European Union's recent relaxation of the proposed 2035 ban on internal combustion engines—though still upholding stringent emissions regulations—is likely to sustain steady industrial demand. In parallel, China's introduction of palladium futures has provided a domestic hedging mechanism and enhanced market liquidity. On the supply front, the World Platinum Investment Council (WPIC) anticipates an easing in market constraints by 2026, which could see a transition from a deficit to a surplus, though recycling rates and automotive demand remain pivotal factors. Additionally, the United States has classified Platinum Group Metals (PGMs) as critical minerals, and investors are currently awaiting clarification on the US tariff policy, anticipated in January.