The escalation of the Middle Eastern conflict since late February has driven a sharp rise in energy prices, as a key route for oil and LNG shipments has been disrupted once again.

For the mining sector, this is a clear headwind. Energy can account for up to 40% of operating costs, meaning higher prices directly pressure margins, particularly for producers with limited hedging in place. 

In the Weekly Market Digest, the risk of renewed US inflation moved back to the forefront last week as the Federal Reserve held rates steady, but this time the concern is less about tariffs and more about energy-driven inflation. 

The prospect of higher real interest rates pressured precious metals, dragging down the associated equity ETF benchmarks and junior resource equities. At the same time, concerns that higher energy costs could slow global growth hampered industrial metals, along with the equities levered to them.

The Exploration Insights Portfolio had a forgettable week and was broadly in line with the precious metal equity ETF benchmarks but lagged the industrial metal benchmarks. That said, the pullback in resource equities may present opportunities for those who felt they had missed the move prior to the PDAC conference, as valuations have reset across much of the sector.

Last week, a cash-flowing Top Pick royalty company issued its first dividend, while a gold-antimony developer in Victoria raised its profile, and a gold developer in Idaho received some positive permitting news.

In The Rant, I focus on the cost of capital for non-cash-flowing junior explorers and developers as the risk has shifted quickly from a non-issue to a growing concern. I cover recent financing transactions from companies in the portfolio. On a positive note, most companies in the portfolio raised capital ahead of the ongoing Middle Eastern hostilities.

In Stock Talk, I review the latest polymetallic intersections from a magmatic nickel-copper deposit in Minnesota.