EUROPEAN COMMODITIES UPDATE: Crude holds onto gains whilst spot gold probes 1,900

Analysis details (10:05)

WTI and Brent front month futures hold onto a lion’s share of overnight gains with emanated from a weekend escalation on the Russia-Ukraine front, which saw G7 nations targeting Russia’s access to SWIFT alongside a freeze on CBR assets. Futures jumped some 5% apiece with WTI April around USD 96/bbl after testing UD 99/bbl to the upside overnight, whilst the Brent May contract briefly rose north of USD 100/bbl. In terms of Iranian nuclear talks, despite the recent myriad of optimism, Iranian officials suggested three sticking points remain despite the deal being 98% done. Iranian said last week that nothing is agreed on until everything is agreed on. The upcoming week sees one of the more nuanced OPEC+ meetings whereby sources suggested ministers will maintain the current plans to hike output by 400k BPD/m, whilst Saudi is likely to stay away from the Russian-Ukrainian conflict. Over the weekend, OPEC+ revised its 2022 oil market surplus forecast down to 1.1mln bpd from 1.3mln bpd and it missed oil output targets by 972k bpd in Jan vs. 824k bpd in December, according to the JTC. Elsewhere, UK Ministers are said to be preparing to release over 1mln barrels of the UK’s strategic oil reserve to tackle rising fuel prices, according to The Times. Meanwhile, Asian oil buyers are reportedly attempting to secure more Saudi oil amid the Russia-Ukraine crisis, according to Bloomberg citing traders. Elsewhere, spot gold meanders around the USD 1,900/oz mark following a pop higher to around USD 1,930/oz at the open overnight. Meanwhile, Dalian iron ore futures saw losses overnight with China state planner stating they will step up supervision of iron spot and futures markets to ensure stable market operation, while it will hold a meeting with the market regulator and the Dalian exchange to look into irregular trading in iron ore spot and futures markets.

28 Feb 2022 - 10:05- Research Sheet- Source: Newsquawk