EUROPEAN COMMODITIES UPDATE: Commodities clamber off lows as risk settles

Analysis details (09:35)

• 
  WTI and Brent front-month futures are lower intraday as a function of risk, with both benchmarks trundling lower since the downbeat APAC session. WTI Apr fell to a low of USD 64.12/bbl from a USD 67.45/bbl peak, while Brent May dipped to USD 70.12/bbl from an intraday high of USD 73.74/bbl. Traders will continue to monitor the fallout of financial stability risks ahead of the FOMC and BoE meetings later this week. Before that, Russian President Putin is due to receive Chinese President Xi in Moscow – the two members will likely deepen bilateral cooperation, but any short-term material war-related updates from the meeting are not likely or are unlikely to be telegraphed. Elsewhere, there were reports that the Kuwait Oil Company declared a state of emergency over an oil spill located in west Kuwait, although production is unaffected.


• Over to gas markets, Dutch TTF and US Henry Hub Futures again see a divergence, with the former briefly dipping under EUR 40/MWh in early trade, whilst the latter sees modest gains intraday but remains sub-USD 2.50/MMBtu.


• Looking at metals, spot gold briefly topped USD 2,000/oz from a USD 1,968.18/oz low before meeting resistance near its March 10th 2022 high at around USD 2,009/oz. The gains this morning coincided with another bout of risk aversion in the markets, with traders likely to keep an eye on financial stability ahead of the FOMC and BoE announcements later this week. Base metals are now mostly firmer as risk appetite improves, with 3M LME copper finding support around USD 8,500/t, but with traders cautious ahead of risk events.

20 Mar 2023 - 09:35- Fixed IncomeResearch Sheet- Source: Newsquawk