EUROPEAN COMMODITIES UPDATE: Brent consolidates while metals benefit from the Dollar’s retreat

Analysis details (10:18)

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  WTI Nov and Brent Dec futures are flat intraday following yesterday’s pullback in prices which saw contracts settle lower by USD 1.97/bbl and USD 1.26/bbl respectively – retreating from fresh YTD despite the pullback in the Dollar yesterday. Price action overnight was choppy within a tight range with volumes likely impacted by the absence of mainland Chinese players amid the start of the mid-Autumn festival. Throughout the European morning, crude prices have been relatively flat but tilting higher in lockstep with broader risk sentiment on month and quarter end, but the range of price action this morning is narrow. Fresh fundamental factors have remained light. Analysts at ING posit “There is likely reluctance amongst participants to push too much higher right now with the market clearly in overbought territory. There is also possible nervousness that OPEC+ and specifically Saudi Arabia could start to ease cuts earlier than scheduled if prices move much higher.” That being said, next week’s JMMC meeting is not expected to deliver any surprises and is framed by energy journalists as a “routine” meeting. WTI resides just under USD 92/bbl in a USD 91.54-92.12/bbl intraday parameter, while Brent sits around USD 93/bbl in a USD 92.89-93.45 band.


• Over to metals spot gold is modestly firmer amid the pullback in the Dollar after tumbling to a low of USD 1,857.79/oz this week – the lowest since early March – largely due to the rise of the Greenback. Near-term technicals are sparse and ahead of the USD 1,850/oz psychological level. Base metals are also on a firmer footing amid the Dollar pull-back and the broader constructive risk profile. 3M LME copper has rebounded back to a USD 8,300/t handle after trading under USD 8,100/t earlier in the week. Iron ore prices in the East meanwhile were mixed but remained elevated heading into China’s week-long hiatus, although desks continue to sound alarms with regard to downside demand risks emanating from the Chinese property sector. Dalian futures fell from the September 15th peak of CNY 873/t but are still over 18% above the recent August low of CNY 718/t.

29 Sep 2023 - 10:22- MetalsResearch Sheet- Source: Newsquawk