EUROPEAN COMMODITIES UPDATE: Crude attempts to claw back recent pressure, XAU moves below USD 2.9k/oz

WTI/Brent: +0.4%/+0.3%

• Brent trades at USD 69.55/bbl, attempting to claw back losses of nearly 2.5% in Wednesday’s session, settling below the USD 70/bbl mark after briefly dropping to a three-year low, amid continued choppy sentiment, tariff uncertainty, a plunging Dollar, and China pledging to boost spending failed to lift prices.


• On the latter, PBoC Governor Pan said they will study and establish new structural policy tools, cut interest rates and the Bank's RRR at an appropriate time, roll out a tech board on the debt market, and expand the relending facility for the tech sector from CNY 500bln to CNY 800bln-1tln.


• Wednesday’s crude data revealed a larger build than expected, against the surprise draw in private inventory figures on Tuesday night, which weighed on the complex. Although, gasoline and distillates both saw a larger draw than expected, with weekly crude production rising 6k W/W. Although, as risk sentiment improved, after Trump tariff relief, through the US afternoon, benchmarks came off lows but still settled notably in the red.


• In geopolitics, Trump issued a warning to Hamas, demanding the release of hostages and return of bodies, stating that Israel would receive full US support to "finish the job" if the demands were not met. Hamas responded that Trump’s remarks confirmed US complicity in alleged genocide.


• Meanwhile, Ukraine said they anticipate positive developments in cooperation with the US, as President Zelensky’s aide held discussions with US National Security Advisor Waltz on steps toward a "just peace."

Dutch TTF: +0.1%

• Dutch TTF trades at EUR 41.55/MWh, essentially flat on the session in narrow parameters, after finishing Wednesday’s session with losses of 4.5%.


• ING writes that positioning data reveals investment funds cut their TTF holdings by 56.5TWh, bringing their net long position to 174.8TWh - the lowest since July, with the EU Commission’s postponed release to phase out Russian fossil fuels hardly helping, which some interpret as a signal that a partial resumption of Russian pipeline gas could be possible under a peace agreement.

Gold: -0.8%

• Gold futures are now below the USD 2900/oz mark; weighed on by the pick up in risk sentiment after the White House said they will give a one-month exemption on any autos coming through USMCA. Elsewhere, Trump commentary on Hamas failed to lift prices, with a drought of new drivers in Ukraine, apart from the points discussed in Energy.


• UBS expects platinum to be undersupplied by 500k/oz in 2025, keeping the metal in a deficit for a third consecutive year; targets platinum price of USD 1100/oz by mid-2025; expects Platinum to lag Gold until lower rates support stronger industrial activity

3M LME Copper: -0.9%

• Copper futures are in the red, tracking the broader risk tone as the modest bounce in US performance at the tail end of Wednesday’s session fizzled out with European futures seeing a stronger open but coming off best; overall, the base metal is largely tracking the fortunes of US futures at this moment.


• Elsewhere, PBoC Governor Pan said they will study and establish new structural policy tools, cut interest rates and the Bank's RRR at an appropriate time, roll out a tech board on the debt market, and expand the relending facility for the tech sector from CNY 500bln to CNY 800bln-1tln.


• Finally, for aluminium, a global producer is reportedly seeking a USD 245/T April-June premium in Japan discussions, via Reuters citing sources; +7% Q/Q.

06 Mar 2025 - 10:20- ForexGeopolitical- Source: Newsquawk