Platinum and Palladium prices have risen sharply, driven by record highs in Silver and Gold, along with increasing demand from the European automotive sector. A possible easing of the EU’s 2035 combustion engine ban might lead to even greater demand for these metals. Platinum has hit $1,800 per troy ounce, marking its highest point since 2011. Palladium is trading around $1,600, slightly below its peak of $1,636 from two and a half years ago. The recent strong performance of Gold and Silver, with Silver reaching a record $64.7 per troy ounce, is a key factor in this upward trend.

Potential EU Policy Impact

The possible change to the EU’s 2035 combustion engine ban could further drive these prices up. This shift suggests a higher future demand for Platinum and Palladium in the automotive sector over the next decade. Market insights from the FXStreet Insights Team, made up of both internal and external analysts, provide expert analysis on what is affecting commodity prices. Due to the substantial increase in platinum and palladium prices, we expect this momentum to continue in the near future. The strong performances of Gold and Silver indicate a wider rally across precious metals. This suggests a focus on bullish trading strategies since strong investor sentiment is lifting the entire sector. The potential easing of the EU’s combustion engine ban represents a significant change in demand. Recent data from the European Automobile Manufacturers’ Association showed a surprising 3.5% rise in hybrid and gasoline vehicle registrations in November 2025, indicating that automakers might be preparing for a policy shift. This makes longer-term call options on platinum and palladium futures a compelling option, as industrial demand may stay strong much longer than expected.

Macroeconomic Influences

We’re seeing the precious metals market being influenced by macroeconomic factors, particularly the US Federal Reserve’s recent indication of a more relaxed interest rate policy for 2026. This has weakened the US dollar, making dollar-denominated commodities like platinum cheaper for foreign buyers, increasing their attractiveness as an inflation hedge. The current environment favors using options to gain leveraged exposure to potential price increases. Although platinum has surpassed a major resistance level not seen since 2011, palladium is lagging behind its 2.5-year high. This creates an opportunity for palladium to catch up and potentially outperform platinum in the coming weeks. We believe that strategies like bull call spreads on palladium could present a favorable risk-reward profile, allowing traders to capture potential gains while minimizing initial costs. On the supply side, we’ve got our eyes on upcoming wage negotiations in South Africa, the world’s largest platinum producer, set for early 2026. Historically, these talks have caused production uncertainties, and any signs of disruption could lead to further price increases. This supply risk makes selling out-of-the-money puts an appealing strategy for collecting premiums while keeping a bullish outlook. Create your live VT Markets account and start trading now.

here to set up a live account on VT Markets now