EUROPEAN COMMODITIES UPDATE: Crude climbs amid geopols and copper benefits from protests

Analysis details (10:50)

• Overall, a fairly contained session for the crude complex as the benchmarks have spent the vast majority of the European morning within an overnight range of around USD 1/bbl. Though, a concerted bid in the space has been seen most recently and perhaps in wake of the morning’s geopolitical commentary from the likes of Russian Foreign Minister Lavrov, who reiterated that if Finland/Sweden were to join NATO there would be corresponding military measures. Additionally, Serbian President Vucic has seemingly distanced himself from Russia in earlier remarks stating that Crimea is Ukraine and the EU path is the only one for Serbia; reminder, Serbia and Russia have historically been close allies.


• As it stands, WTI Feb’23 and Brent Mar’23 are at the top-end of USD 80.55-81.86/bbl and USD 86.13-87.43/bbl parameters, ranges that mark fresh YTD peaks for the complex, though, the benchmarks remain well within late-2022 extremes.


• Geopolitics aside, the main energy event this morning has been the IEA OMR which looks for 2023 demand to increase to a record 101.7mln BPD; though, as was the case with the EIA STEO and OPEC MOMR, the release is a touch stale with participants and OPEC+ looking ahead to the impact of China’s New Year Holiday from January 21st onwards. Given MLK Day, the Private inventory report will be released tonight and the EIA equivalent on Thursday; reminder, last week’s release saw sizeable headline builds of 14.9M and 18.96M respectively, this week’s releases are expected to show a more modest headline build of 2.325M.


• Moving to metals, spot gold is essentially unchanged and unable to derive much support from the Dollar’s weakness as the overall tone remains a tentative one post-BoJ as we await a number of Fed speakers and key US data. Currently, the yellow metal is pivoting USD 1910/oz. Copper prices are bid this morning in the wake of disruption to Glencore’s Antapaccay copper mine in Peru, which is operating at restricted capacity amid anti-government protests, according to Reuters sources.

18 Jan 2023 - 10:50- MetalsResearch Sheet- Source: Newsquawk