EUROPEAN COMMODITIES UPDATE: Crude flat, precious metals mixed, and base metals mostly lower amid tariff woes

Crude Oil: WTI Apr U/C, Brent May U/C

• Uneventful trade in the crude complex to start the week amid a lack of pertinent drivers for the complex and with traders awaiting further updates on geopolitics and OPEC+ amid growing noise surrounding a potential delay to the unwind of voluntary cuts.


• Oil prices traded marginally lower in APAC trade after reports over the weekend Iraqi Kurdistan authorities agreed with the federal oil ministry to restart Kurdish crude exports based on available volumes, while Iraq’s Oil Minister announced that all procedures for exporting oil through the Turkey pipeline have been completed. However, the downside in oil is limited with the losses stemmed by a weaker dollar. Iraq's Oil Minister said they are waiting for Turkey's approval to restart oil flow, Kurdish oil exports will "hopefully be ready" in two days


• In terms of geopolitics, Israel sent tanks into the West Bank and told troops to prepare for an extended stay, according to Reuters. Elsewhere, Ukrainian President Zelensky said the issue of elections is a step to apply pressure on Ukraine and he is willing to quit the presidency if it means peace in Ukraine which he said could be exchanged for NATO membership.


• Crude prices were sold on Friday with both WTI and Brent settling at lows. WTI futures (J5) traded between USD 72.77 and 70.29/bbl, while Brent (J5) traded between 76.75 and 74.32/bbl, settling USD 2.08/bbl and USD 2.05/bbl lower respectively.


• BofA forecasts Brent crude at USD 75/bbl in 2025 and USD 73/bbl in 2026 with oil markets set to remain in a modest surplus in the near term. BofA suggests that over the medium term, Brent should average between USD 60-80/bbl to keep the global oil market in balance.


• WTI Apr resides in a USD 69.80-70.49/bbl range and traded briefly sub-USD 70/bbl for the first time this year. Brent May trades in a USD 74.11-74.62/bbl parameter.


• Nat gas futures meanwhile trade softer on either side of the pond with milder weather forecasts keeping the complex subdued.

Precious Metals: Gold +0.3%, Silver U/C, Palladium -1.3%

• Mixed trade across precious metals with little in terms of fresh fundamentals driving price action, although spot palladium could be lagging after US President Trump reiterated the auto tariff set to kick in on April 2nd.


• In terms of geopolitics, Israel sent tanks into the West Bank and told troops to prepare for an extended stay, according to Reuters. Elsewhere, Ukrainian President Zelensky said the issue of elections is a step to apply pressure on Ukraine and he is willing to quit the presidency if it means peace in Ukraine which he said could be exchanged for NATO membership. Russia's Kremlin this morning said, "We welcome and support the new US approach to dialogue with Russia". Meanwhile, the Russian Consulate General confirms the explosion took place inside the consulate in Marseille - but details remain light.


• Spot gold resides in a USD 2,921.47-2,948.88/oz range thus far, within Friday's USD 2,916.82-2,949.93/oz parameter and below the current USD 2,954.96/oz record high set last Thursday.

Base Metals: 3M LME Copper -0.4%

• Subdued trade as the Dollar recovered and sentiment waned in early European trade, with tariff woes still in the background amid Trump's reiterations.


• Prices were unfazed by the encouraging reports overnight suggesting Chinese state-backed developers beginning to buy land at a premium again.


• Elsewhere, two EU Diplomats say EU Foreign Ministers approve the 16th sanctions package against Russia - which includes a primary aluminium import ban and listing of 73 new shadow fleet vessels.


• Dalian iron ore prices fell overnight and ended daytime trade -0.8% with traders citing increasing levies on Chinese steel, although a decline in portside inventories stemmed further losses.


• 3M LME copper trades on either side of USD 9,500/t in a current USD 9,485.00-9,558.55/t range.

24 Feb 2025 - 09:55- ForexGeopolitical- Source: Newsquawk