EUROPEAN COMMODITIES UPDATE: Crude lacklustre, Gold benefits from haven flows & copper dented by Trump tariff details

Crude Oil: WTI Sep -0.1%, Brent Oct -0.1%

• Relatively flat trade intraday for the crude complex following a session of gains on Wednesday, continuing to be propped up by the shortened US deadline for Russia to reach a peace deal with Ukraine.


• Further upside was exacerbated by US President Trump threatening to impose a penalty on India for importing Russian crude, on top of the 25% tariff he set for the country effective August 1st.


• On the deals front, South Korean Presidential Office confirmed US lowered tariffs on South Korean autos to 15% from 25%, while it added that chips and drug tariffs will not be worse than those applied to other countries and stated that USD 200bln of funds are allocated for chips, nuclear power, batteries, and bio sectors. Furthermore, it stated that the rice and beef market will not be opened and that South Korea demanded 12.5% auto tariffs, but President Trump insisted on 15%.


• This European morning has been largely focused on corporate earnings, although now attention shifts to any further deals announced by the US alongside any updates on the penalty imposed on nations importing Russian oil.


• In terms of China, there has been no news regarding Trump greenlighting an extension; thus, another risk for traders to monitor.


• Looking at today's docket, scheduled risk events are in the form of today's US data (PCE, Jobless Claims), albeit with the Fed now out of the way until mid-September, the next set of tier-1 releases could garner more attention.


• WTI Sep resides in a USD 69.80-70.41/bbl while Brent Oct trades in a USD 72.16-72.82/bbl range.

Precious Metals: Gold +1.1%, Silver -0.4%, Palladium +0.9%

• Mixed trade across precious metals with spot gold the marked outperformer despite a softer Dollar, but with haven flows emanating from tariff woes as the August 1st US tariff negotiation deadline looms.


• Spot gold during the FOMC yesterday declined following a hawkish-leaning Powell, although those losses are almost entirely trimmed at the time of writing.


• Furthermore, there has been no news confirming the trade truce extension between the US and China - headline risk remains. Note, the truce expires on August 12th.


• Meanwhile, after Trump imposed a 25% tariff on India, and an additional penalty for importing Russian crude, India is reportedly mulling options to appease US President Trump following a "shock" 25% tariff level, according to Bloomberg sources; India reportedly mulling upping its natgas purchases from the US, and imports of communication equipment and gold.


• Spot gold resides in a USD 3,276.28-3,314.98/oz range at the time of writing, within yesterday's USD 3,268.12-3,334.09/oz parameter.

Base Metals: 3M LME Copper -0.6%

• Comex copper prices slumped over 20% after the White House provided details on the copper tariff, with a universal 50% tariff on imports of semi-finished copper products and copper-intensive derivative products effective August 1st, while refined and concentrate imports will be excluded.


• Analysts at ING suggested, " Until the announcement, copper prices in the US had been trading at a 28% premium over the LME price, with the market front-running expected tariffs. However, the strong flow of refined copper into the US will come to an end with the Comex-LME arb collapsing. However, there is still the risk of tariffs on refined copper at a later stage, with the US Secretary of Commerce recommending a phased universal tariff on refined copper of 15% in 2027 and 30% in 2028."


• 3M LME copper prices reside in a USD 9,575.15-9,820.78/t range while CME prices trade in a USD 4.3332-4.652/lb parameter.

31 Jul 2025 - 10:00- ForexGeopolitical- Source: Newsquawk