EUROPEAN COMMODITIES UPDATE: Choppy waters across crude and gold, but LME nickel continues to hit limit-up

Analysis details (10:30)

WTI and Brent May contracts are choppy, around USD 114.50/bbl (112.84-116.64) and USD 121.50/bbl (120.00-123.00 range), respectively. Energy traders will be keeping a close eye on the NATO, G7 and European Council triathlon – with energy poised to be one of the main topics of interest. Eurasia’s Rahman suggested, “The threshold for energy import bans is very high”. However, the Biden Administration and the EU are close to a deal that would cut dependence on Russian oil, with the US National Security Advisor suggesting a deal can come as soon as Friday. That being said, Times’ Waterfield reported that a “Big EU three-way split on energy means any deal on cutting dependency on Russian gas and bringing down soaring energy costs will not happen [on Thursday]”. Seemingly, The Netherlands and Germany are against the proposed price caps - "A Belgian so-called non-paper, seen by POLITICO, calls for a gas price cap at €120 per megawatt-hour, which could be pegged to American and Asian prices to remain competitive.", Politico recently reported. Meanwhile, a senior German official cited by EurasiaGroup’s Rahman “Berlin's opposition to energy sanctions is ‘unlikely to change’ unless Russia uses ‘chemical or nuclear weapons”. (full Newsquawk primer and schedule available here). Elsewhere, Iranian nuclear talk progress once again hits a hurdle, with "Sources now sound increasingly pessimistic about the chances of restoring the JCPOA.", according to Journalist Liechtenstein, whilst Energy Intel suggests too many sticking points remain. Over to metals, spot gold is choppy in a contained range but has failed to sustain a breach above the 21DMA at around USD 1,948/oz. Finally, LME Nickel once again hit the 15% limit up mark following similar gains in China – with market contacts pointing to supply-disruption positioning.

24 Mar 2022 - 10:30- EnergyResearch Sheet- Source: Newsquawk