EUROPEAN COMMODITIES UPDATE: Crude climbs amid Miro and Colonial issues, Erdogan calls for a ceasefire

Analysis details (10:55)

• WTI and Brent are firmer on the session, though the upside stalled on approach to the USD 75/bbl and USD 80/bbl handles respectively with the benchmarks still lower by over USD 5/bbl WTD. Upside occurred, counterintuitively, in proximity to remarks from the Turkish Presidency in relation to a call with Russian President Putin in which Erdogan called on Putin to declare a ceasefire against Ukraine; seemingly the first time he has publicly called for this. While a concerted move higher in crude occurred near this, it was perhaps driven by updates from Germany’s Miro refinery shortly after, in which the site says one of the three oil distillation facilities was taken out of service on December 25th, and is expected to be down for ~four-weeks. For reference, the refinery is the largest in Germany and has an oil capacity of 11.6mln/TPY.


• On the subject of crude facility downtime, the Colonial Pipeline overnight announced that Line 3 is down for unscheduled maintenance but is expected to restart on January 7th. The overall pipeline has capacity of around 3mln BPD, though Line 3 is one of the smaller lines within this.


• Elsewhere, Morgan Stanley has reduced its TTF forecast for 2023 and 2024 to a EUR 64/MWh equivalent, compared to the current EUR 66/MWh for the February’23 contract and the circa. EUR 70/MWh for the Summer/Q3 2023 contracts.


• Moving to metals, spot gold is little changed and remains in close proximity to the USD 1850/oz mark, having pulled back slightly from Wednesday’s USUD 1864/oz peak, which was the highest price point since June 13th at USD 1877/oz. Elsewhere, base metals are bid having recovered from APAC pressure as China’s accelerated reopening is marred by COVID concerns as the WHO outlines its concerns that China’s COVID statistics are not accurately showing the outbreak's true impact.

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