EUROPEAN COMMODITIES UPDATE: Crude continues to climb while XAU is torn between risk & USD

Analysis details (10:50)

• Crude benchmarks are a touch firmer on the session with specific details light as we await an update from the BSEE on how much, if any, production has been lost due to Hurricane Idalia. Gas markets are bid but off highs while spot gold is little changed and torn between the softer risk tone and stronger USD.


• WTI Sep’23 and Brent Aug’23 are firmer by circa. USD 0.50/bbl and at the top-end of respective USD 81.48-81.99/bbl and USD 85.08-85.57/bbl parameters. As Hurricane Idalia moves further inland and begins to wane we look to the BSEE for an update on potential production outages; generally, the BSEE updates at 19:00BST/14:00ET on any lost production from the prior session in the Gulf of Mexico. Elsewhere, the coup in Gabon has resulted in President Bongo being placed under house arrest following weekend elections and General Nguema has assumed power. Action which sparked marked upside in some individual energy names, particularly Tullow Oil, on Wednesday given Gabon which is an OPEC+ member produces circa. 200k BPD of crude.


• Within the agriculture space, Reuters citing Turkish sources reported that President Erdogan is to meet Russia President Putin in Sochi on September 4th to discuss Ukraine and the grain deal. As a reminder, earlier in the week reports indicated that the nation's Foreign Ministers are to speak in today’s session as Turkey looks to bring Russia back to the Black Sea grain deal.


• Moving to metals, spot gold is essentially unchanged on the session as the yellow metal is torn between the slight deterioration in the risk tone throughout the morning and the stronger USD on action of EUR downside. Base counterparts are in the red, continuing the pullback in yesterday’s session and after mixed Chinese data failed to inspire with additional pressure emanating from the USD, as mentioned.

31 Aug 2023 - 10:50- MetalsEU Research- Source: Newsquawk