Impact of Gas & Oil Prices on Scrap Metal Prices
Posted: December 17, 2014
One of the more infamous questions that we have been asked dozens of times is if we think that the metals market is going to go up or down soon. We jokingly answer that if we knew the future we would long be retired, but the question is still worth looking into.
Metal prices used to be mostly based off of the classic demand vs. supply in many markets, but has changed quite a bit over the last 10-15 years. As the stock market and different commodity markets have developed into another arm of Wall Street firms the metals market has been forever changed.
Copper, Aluminum, Zinc, and Iron prices have become commodities that are traded almost like stocks have and that is part of the reason that the prices have changed so drastically and tend to make large up and downswings into different markets.
The gas and oil markets have also become part of the trading curve and while supply vs. demand is always involved, it is not the whole reason for pricing to be affected.
Some of the reasons that the market moves are:
- Time of the Year
- Wars going on
- Demand vs. Supply
- Stock Prices
- Oil and Gas Supply
- Global Development
While the price of gas seems to be the most common reason that people think that copper or other metals move, it is only a part of the equation.