EUROPEAN COMMODITIES UPDATE: Crude holds onto post-OPEC gains while gold meanders and base metals see mass closures

Analysis details (10:00)

WTI and Brent futures have been waning off best levels following the overnight consolidation seen in the aftermath of the OPEC+ confab. Futures came off their best levels in early European hours in tandem with some downside in stocks, but the contracts remain within recent ranges. Some participants have been scratching their heads with regards to yesterday’s crude reaction during the OPEC+ meeting; to briefly explain this, the complex was supported by several factors: the aggregate amount of barrel additions agreed in quotas will be the same (as September’s increase was split between July and August), OPEC+ hiking output in increments means Russia will not be exempted from the pact (thus no additional barrels), OPEC+ unity was seen, with the meeting lasting 11 minutes with no objections or friction, there was no guidance on the future after OPEC+ deal ends; real output will likely come into focus – which has been much less than quotas, the OPEC+ risk event is now out of the way until the next meeting at the end of June, and the EU partial oil ban was approved around that time after the roadblock presented by Hungary. Today, eyes are on risk sentiment ahead of the US labor market report, barring any major supply/demand updates. WTI July resides just above USD 116/bbl (low 115.23/bbl) while Brent August trades around the USD 117/bbl mark (low 116/bbl). Elsewhere, spot gold is steady above USD 1,850/oz pre-NFP, whilst base metals futures see the closure of Chinese and UK exchanges amid domestic holidays.

03 Jun 2022 - 09:59- MetalsResearch Sheet- Source: Newsquawk