EUROPEAN COMMODITIES UPDATE: Crude is contained but near YTD peaks pre-OPEC+ amid further geopolitical commentary

WTI and Brent are fairly contained this morning continuing the holding pattern seen in APAC hours as we await today’s OPEC+ gathering which commences from 12:00GMT/07:00EST when the JMMC meets and then 13:00GMT/08:00EST for the full meeting - timings, as always, for guidance only. Currently, the benchmarks are holding around USD 0.30/bbl above the USD 88.00/bbl and USD 89.00/bbl marks respectively just shy of the USD 88.87 YTD high in WTI, for instance. Newsflow has been fairly slim so far with little/no updates pre-OPEC on the meeting as Energy Intel’s Bakr remarks that indications are for the meeting to be in-line with expectations that look for a further 400k BPD easing of quota restrictions. Turning to geopolitics, the Russian Kremlin provided familiar remarks on the broader situation but, did add that President Putin has cited “very cautious optimism” on the security discussions; however, there are no plans for a further round of talks with the US. Referencing the Russian situation, Goldman Sachs wrote that assuming this does not escalate and there isn’t colder weather they are maintaining their view of sequentially lower LNG prices into spring. Separately, the EIA inventory release is expected to print a headline build of 1.525M accompanied by mixed internals – expectations that contrast with an unexpected draw in the Private Inventories headline and internal components. Moving to metals, where spot gold and silver are firmer but remain in proximity to known levels and well within the parameters of yesterday’s session; as such, gold is near its 200-, 100- & 50-DMAs once more. Finally, LME copper continues to move with broader risk sentiment and has extended back towards the pivotal 10k/T mark.

02 Feb 2022 - 10:45- MetalsResearch Sheet- Source: Newsquawk