Insights
CommoditiesCommodities outlook February 2026: The Fire Horse has arrived
A look at the pressure points multiplying across commodities and why a diversified, broad allocation may be worth revisiting in portfolio construction.
Author
Robert Minter
Director of ETF Investment Strategy
Duration: 10 Mins
Date: Feb 23, 2026
February marks the beginning of the Chinese New Year, with 2026 ushering in the Year of the Fire Horse.
In Chinese symbolism, Fire Horse years are associated with intense energy, speed, independence, and volatility – periods that challenge established norms and accelerate change.1 In many ways, commodity markets have already adopted the Fire Horse as their mascot. As what we have seen so far in 2026 is not a synchronized commodity surge – but selective ignition.
Energy
Sudden combustion
Nowhere has that ignition been more visible than in energy.
Oil, natural gas, and gasoline have all experienced rapid shifts over the past month. Oil, which finished 2025 with the lowest portfolio allocation since 2014, has risen 20% since December 16 – a move that surprised much of the market.2,3
Oil
At the time of writing, the US has two aircraft carrier strike groups in the Middle East, representing more concentrated airpower in the region than at any point since the 2003 Iraq invasion, as efforts intensify to prevent Iran from developing a nuclear weapon.4 Yet, despite this backdrop, most portfolios remain underweight oil relative to the 10-year average.5
Natural gas
Natural gas tells a parallel story of tightening fundamentals. After exiting last winter with the highest inventory levels in five years, storage fell to 5.6% below seasonal averages by mid-February following a particularly cold January.6 That sets up the need for above-average refilling between April and October, a dynamic that could support prices through the injection season.
Gasoline
Gasoline, meanwhile, saw inventories rise 23% from early November through mid-January, one of the sharpest increases in recent history as frigid temperatures curtailed US driving demand.7 That temporary chill in consumption has helped soften gasoline prices even as geopolitical tensions simmer.
Energy, in short, has reignited – but unevenly.
Our research
Commodities sit at just 4.6% of portfolios, yet 41% of advisors plan to add more. Why?
Our perspective
For more timely, in‑depth perspectives on commodities and precious metals from our in-house expert.
Gold
Sustained intensity
If energy reflects the fire, then gold reflects the persistence.
Few commodities have experienced the sustained intensity of gold demand over the past four years. Central bank buying had already been rising into early 2022, but after the confiscation of $300 billion in Russian reserves following the invasion of Ukraine, diversification away from US dollar exposure accelerated meaningfully.
From 2022 through 2024, central banks purchased more than 1,000 tons of gold annually, nearly one-third of global mine supply each year. Recent data shows they continued buying 863 tons in 2025.8
Given that gold’s average price rose from $2,389 in 2024 to $3,442 in 2025 – a 44% increase – the dollar value of those purchases may have risen approximately 24% year-over-year, depending on timing.9
The intensity remains intact. This is not speculative heat – it is structural allocation.
Silver
Speed and volatility
If gold represents persistence, then silver embodies the Fire Horse’s pace.
After never previously reaching $50/oz until December 2025, silver prices swung between nearly $120 and $72 the following month – a range that exceeds the highest price of the past two decades.10
That volatility did not emerge in isolation. The silver market has run persistent supply deficits since 2019, driven by both rising demand and constrained mine supply.11 In December, Indian pension funds received approval to allocate to physical silver and gold.12 On January 1, China, where roughly 60% of global silver is refined, implemented new export licensing requirements, a step that could foreshadow tighter controls in the future.13
At the same time, private sector participants are responding. Samsung recently helped fund the reopening of a silver mine in Mexico operated by Silver Storm Mining.14
Silver’s volatility reflects its inelastic structure. Mine supply cannot respond quickly. Industrial demand cannot easily substitute away. When investor flows enter or exit, prices move disproportionately.
A more transformative backdrop
Others also believe the Fire Horse symbolizes independence and transformation.
That broader theme may be most evident not in any single commodity, but in the macro environment shaping them.
Recent commentary from Ray Dalio argues that the post-1945 world order is fracturing, which aligns in part with Graham Allison’s Destined for War, a book we first highlighted in 2018.15 Both of which examine centuries of history when rising powers challenged incumbents.
The pattern often involves an established power overextending financially while a rising power exploits that imbalance. Allison suggests the US and China may avoid direct military conflict given their economic interdependence, instead operating in a prolonged state of co-opetition. Dalio is less certain, arguing that in late-cycle dynamics all outcomes remain possible.
What is undeniable is that we are in a sustained era of resource nationalism.
China secured supply chains years ago as a matter of national security. The US and Europe are only now accelerating similar efforts.
If a global oil market requires only a 2% imbalance between supply and demand to drive price extremes, what happens when supply chains are re-routed based on political alignment rather than efficiency?
A deglobalizing world does not eliminate volatility – it amplifies it.
Final thoughts
The Chinese zodiac cycles every 60 years through twelve animals and five elements. The last Fire Horse year was 1966 – the beginning of China’s Cultural Revolution. Transformative and independent, it certainly proved to be. Whether 2026 proves as consequential remains to be seen. But the early signals are clear: selective ignition, structural repositioning, and a world increasingly willing to challenge established norms. The Fire Horse is not about uniform acceleration. It is about intensity and volatility – where pressure points already exist. And in commodity markets, those pressure points are multiplying. In an environment defined by geopolitical tension, resource nationalism, and tightening supply elasticity, the case for broad commodity exposure may be worth revisiting. Commodities are often the transmission mechanism of policy shocks, inflation surprises, and supply disruptions. A diversified allocation is not about predicting which spark will ignite next – it is about recognizing that in more tumultuous regimes, volatility itself becomes an investable characteristic. Fire Horse years challenge assumptions. Portfolio construction may need to do the same.
Endnotes
1 "Year of the fire horse - explained: the Chinese zodiac sign that’s all about intensity." The Guardian, February 2026. https://www.theguardian.com/lifeandstyle/2026/feb/19/fire-horse-zodiac-sign-lunar-new-year-explained-predictions.
2 Bloomberg data, net long WTI contracts, 12/31/2013 to 12/31/2025.
3 Bloomberg data, WTI price per barrel, 12/16/2025 to 2/19/2026.
4 "U.S. Gathers the Most Air Power in the Mideast Since the 2003 Iraq Invasion." The Wall Street Journal, February 2026. https://www.wsj.com/world/middle-east/u-s-gathers-the-most-air-power-in-the-mideast-since-the-2003-iraq-invasion-98ced89f?.
5 Bloomberg data, WTI net long contracts, 12/31/2015 to 2/10/2026.
6 "Weekly Natural Gas Storage Report." U.S. Energy Information Administration, February 2026. https://ir.eia.gov/secure/ngs/ngs.html.
7 Bloomberg, US commercial petroleum inventory, 11/7/2025 to 1/9/2026.
8 "Gold Demand Trends: Q4 and Full Year 2025." World Gold Council, January 2026. https://www.gold.org/goldhub/research/gold-demand-trends/gold-demand-trends-full-year-2025.
9 Bloomberg, data average gold price, 12/31/2023 to 12/31/2024 and 12/31/2024 to 12/31/2025.
10 Bloomberg, data silver price per ounce, 1/1/1949 to 2/19/2026.
11 "Silver Supply and Demand." The Silver Institute, February 2026. https://silverinstitute.org/silver-supply-demand/.
12 "India's pension regulator widens investment options for funds." Reuters, December 2025. https://www.reuters.com/world/india/indias-pension-regulator-widens-investment-options-funds-2025-12-10/.
13 "China names companies allowed to export silver over 2026-2027." Reuters, December 2025. https://www.reuters.com/world/asia-pacific/china-names-companies-allowed-export-silver-over-2026-2027-2025-12-30/.
14 "Silver Storm Enters into US$7.0M Offtake Financing with Samsung C&T for restart of La Parrilla Silver Mine Complex." Silver Storm Mining, October 2025. https://www.silverstorm.ca/2025/svrs-completes-samsung-ct-offtake-financing.
15 "The Munich conference ended the post-war order, says Ray Dalio. How to invest if great powers collide." Yahoo Finance, February 2026. https://finance.yahoo.com/news/munich-conference-ended-post-war-104500490.html.
Important information
The statements and opinions expressed are those of the author and are as of the date of this report. All information is historical and not indicative of future results and subject to change. Reader should not assume that an investment in any securities and/or precious metals mentioned was or would be profitable in the future. This information is not a recommendation to buy or sell. Past performance is not a guide to future results.
The abrdn Silver ETF Trust, abrdn Gold ETF Trust, abrdn Platinum ETF Trust, abrdn Palladium ETF Trust and abrdn Precious Metals Basket ETF Trust are not investment companies registered under the Investment Company Act of 1940 or a commodity pool for purposes of the Commodity Exchange Act. Shares of the Trusts are not subject to the same regulatory requirements as mutual funds. These investments are not suitable for all investors. Trusts focusing on a single commodity generally experience greater volatility.
Commodities generally are volatile and are not suitable for all investors. Please refer to the prospectus for complete information regarding all risks associated with the Trusts.
The value of the Shares relates directly to the value of the precious metal held by the Trust and fluctuations in the price could materially adversely affect investment in the Shares. Several factors may affect the price of precious metals, including: A change in economic conditions, such as a recession, can adversely affect the price of the precious metal held by the Trust. Some metals are used in a wide range of industrial applications, and an economic downturn could have a negative impact on its demand and, consequently, its price and the price of the Shares; Investors’ expectations with respect to the rate of inflation; currency exchange rates; interest rates; Investment and trading activities of hedge funds and commodity funds; and global or regional political, economic or financial events and situations. Should there be an increase in the level of hedge activity of the precious metal held by the Trust or producing companies, it could cause a decline in world precious metal prices, adversely affecting the price of the shares. Should there be an increase in the level of hedge activity of the precious metal held by the Trust or producing companies, it could cause a decline in world precious metal prices, adversely affecting the price of the shares.
Also, should the speculative community take a negative view towards the precious metal held by the Trusts, it could cause a decline in prices, negatively impacting the price of the shares. There is a risk that part or all of the Trusts’ physical precious metal could be lost, damaged or stolen. Failure by the custodian or sub-Custodian to exercise due care in the safekeeping of the precious metal held by the Trusts could result in a loss to the Trusts.
The Trusts will not insure its precious metals and shareholders cannot be assured that the custodian will maintain adequate insurance or any insurance with respect to the precious metals held by the custodian on behalf of the Trust. Consequently, a loss may be suffered with respect to the precious metal that is not covered by insurance. Commodities generally are volatile and are not suitable for all investors.
Diversification does not eliminate the risk of experiencing investment losses.
Investors buy and sell shares on a secondary market (i.e., not directly from Trusts). Only market makers or “authorized participants” may trade directly with the Trusts, typically in blocks of 50k to 100k shares.
This material must be accompanied or preceded by the prospectus. Carefully consider each Trust’s investment objectives, risk factors, and fees and expenses before investing. To view the prospectus, please click here – abrdn Silver ETF Trust, abrdn Gold ETF Trust, abrdn Platinum ETF Trust, abrdn Palladium ETF Trust, and abrdn Precious Metals Basket ETF Trust.
ALPS Distributors, Inc. is the marketing agent.
ALPS is not affiliated with abrdn.
ETF002444 6/30/26
AA-200226-204524-1
