By Karl Plume
CHICAGO (Reuters) -Oil prices surged from a four-year low on Wednesday and gold rallied in a broad-based commodities and equity market rebound after U.S. President Donald Trump said he would temporarily lower recently enacted tariffs on dozens of countries while further increasing duties on China.
U.S. natural gas prices jumped 10% and copper gained nearly 3% after earlier touching an eight-month low as the tariff pause eased market worries that Trump's steep duties, announced last week, could trigger a recession.
Agricultural commodities also climbed, led by soybeans, although gains were more measured as U.S. trade with top farm goods importer China remained a concern.
Major stock indexes shot higher on Wednesday after Trump said he authorized a 90-day pause on many of his new tariffs, effective immediately.
The president, however, further ramped up duties on Chinese goods to 125% from 104% which took effect at midnight in an escalating trade war between the world's largest economies.
The European Commission had said before Trump's pause that it would press ahead with a first set of countermeasures from April 15 against Trump's tariffs on steel and aluminium.
Oil had traded below $60 a barrel on Wednesday before the dramatic midsession turnaround.
Brent futures settled up $2.66, or 4.23%, to $65.48 a barrel. U.S. West Texas Intermediate crude futures closed $2.77, or 4.65%, higher at $62.35 and extended gains in post-settlement trade.
Both contracts had lost about 7% earlier in the session before the reversal.
"A massive shift in sentiment from extremely pessimistic - recession fears - to more optimistic," said UBS analyst Giovanni Staunovo.
"Tariffs between China and the U.S., however, remain for now between the two largest oil consumers. So that will remain a drag for the oil demand outlook," he said.
METALS, GAS AND AGS
Copper rallied on the tariff news, although escalating trade tensions between Washington and Beijing continued to hang over the market.
Benchmark three-month copper on the London Metal Exchange was up 2.8% at $8,897 per metric ton. LME aluminium added 0.3% to $2,357 per ton.
Gold climbed more than 3% in its best day since October 2023, supported by safe-haven inflows amid escalating U.S.-China trade tensions.
U.S. natural gas futures jumped about 10% on Wednesday on the tariff pause and a decline in output in recent days.
Gas futures for May delivery on the New York Mercantile Exchange rose 35.1 cents, or 10.1%, to settle at $3.816 per million British thermal units.
Chicago Board of Trade soybeans