Commodity Super-Spike: Gold Nears $4,500 and Silver Tops $80 on Venezuela Shock and Tariff Fears

A historic melt-up in the commodities sector accelerated on Tuesday, driven by a dramatic escalation in geopolitical tension and structural supply dislocations. Gold (XAU/USD) surged to approach the $4,500/oz mark, while Silver (XAG/USD) exploded over 6% to trade above $80/oz, marking its strongest annual start in decades.

The 'Black Swan': Venezuela Raid

Risk premiums spiked following reports that US military forces conducted a raid in Caracas, arresting Venezuelan President Nicolas Maduro and transferring him to US custody. The unprecedented move has rattled global diplomatic relations and ignited a scramble for hard assets.

“Precious metals traders are pricing in risks that equity markets are ignoring,” noted Jim Wyckoff, a senior analysts at Kitco Metals. The geopolitical shock has compounded demand for bullion, which was already supported by central bank buying and speculative fervor.

Industrial Metals and the Tariff Squeeze

Beyond precious metals, industrial commodities are witnessing a supply-side crisis driven by trade policy fears. Copper prices breached $13,000/tonne on the LME, hitting fresh all-time highs.

“Inventory used to be a buffer, now it is locked in the US,” explained Li Xuezhi of Chaos Tiancheng Futures. The resulting squeeze has forced global buyers into a bidding war, further inflamed by supply disruptions from the Mantoverde mine strikes in Chile.

The 'China Factor'

Retail mania in China is pouring fuel on the fire. With gold prices becoming prohibitively expensive for some, Chinese retail investors—the famed “Damas”—have pivoted aggressively to silver. Reports from Shenzhens Shuibei market describe chaotic scenes of buyers rushing to secure physical silver, driving prices higher in a self-reinforcing loop.