EUROPEAN COMMODITIES UPDATE: Crude firmer as geopolitics remain in the limelight; base metals subdued by the risk tone

Crude Oil: WTI Oct +0.9% Brent Oct +0.9%

• Modestly positive trade in the crude complex in what has been a quiet session thus far, but with eyes remaining on geopolitics amid a couple of notable updates.


• Firstly, on Russia-Ukraine, the optimism seen at the start of the week is seemingly waning as markets come to terms with the difficulty of brokering a cessation of the war. On that note, Ukrainian President Zelensky says Kyiv wants to have an understanding of security guarantees within 7-10 days, followed by bilateral and trilateral leaders' meetings. Russia’s position is that any security guarantees for Ukraine discussed without Moscow are illegitimate and a “road to nowhere.” It insists that Russia must be a party to any agreements affecting Ukraine’s security, rejecting Western-led frameworks. Furthermore, Ukraine's Air Force said Russia used 574 drones and 40 missiles in an overnight attack. This would mark one of the most intense Russian strikes to date. Continued heavy strikes may dampen some of the optimism seen since the recent meetings in the US and potentially lead to sanctions.


• Elsewhere, in the Middle East, Israel has granted final approval for a highly contentious settlement project in the West Bank, a step some warn could split the territory and deliver a major setback to the possibility of a future Palestinian state.


• WTI resides in a USD 62.78-63.40/bbl range while Brent sits in a USD 66.88-67.49/bbl parameter.

Precious Metals: Gold -0.2%, Silver -0.2%, Palladium -1.3%

• Softer trade across precious metals, albeit modest in spot gold and silver, with newsflow on the lighter side and with the metals largely moving in tandem with the dollar.


• Minutes from the Fed’s July policy meeting were received hawkishly, after it showed broad support for holding interest rates steady, with “almost all” officials backing the decision. Two officials dissented (Governors Bowman and Waller), preferring an immediate rate cut, but the remaining 16 participants supported maintaining the current level.


• In Europe, hardly any move was seen to the EZ and UK Flash PMIs, while Stateside, weekly initial jobless claims are seen at 224k in the August 16th week (coincides with the BLS survey window for the US August jobs data) from 225k, while continuing claims are seen up a touch to 1.96mln from 1.953mln. The Philly Fed business survey is seen paring in August. S&P Global PMI data is expected to show US services sector activity easing to 54.2 from 55.7, while the manufacturing gauge is expected to remain sub-50 (seen at 49.5 from 49.8). Meanwhile, US existing home sales are expected at 3.92mln from 3.93mln prior. Finally, the US leading index is expected to fall by -0.1% M/M (prev. -0.3%).


• Price action this morning sees the precious metals complex subdued, with spot gold on either side of its 50 DMA (~3,348.10/oz) in a USD 3,334.28.56-3,352.30/oz range.

Base Metals: 3M LME Copper -0.4%

• Subdued price action across the bae metals complex - in fitting with the broader market mood as traders look ahead to the Jackson Hole Symposium.


• Overnight, Dalian iron ore prices rebounded with trades citing less severe mandated steel production cuts ahead of the military parade, and for a shorter-than-expected duration. Desks suggested previously that the production cuts will dampen demand for the raw material.


• 3M LME copper prices reside in a USD 9,689.45-9,739.40/t range.

21 Aug 2025 - 10:20- MetalsData- Source: Newsquawk