EUROPEAN COMMODITIES UPDATE: Crude moves in lockstep with risk while base metals remain cushioned

Crude Oil: WTI Sep -1.0%, Brent Sep -1.0%

• Subdued trade across the crude complex as prices move in tandem with broader sentiment, with just over a week left until US President Trump's August 1st tariff deadline, with little in the way of deals announced in recent days.


• ING believes "Whether negotiators are close to or still far away from reaching such a deal remains unclear. In any case, there are three ways how this latest [tariff] letter wave can end: i) the new pressure leads to tangible results; ii) tariffs lose their fear factor as the US administration will eventually budge at the risk of losing face; or iii) we are entering a fully-fledged trade war. The theoretical fourth option of postponing beyond 1 August looks highly unlikely and politically not very attractive for the US administration."


• Geopolitics have been light today thus far, whilst ahead of the Iran-E3 meeting this Friday, Iran's Foreign Minister reiterated that Iran will not give up its uranium enrichment program, via IRNA.


• At the time of writing, WTI trades towards the bottom of a USD 65.07-65.86/bbl range while Brent resides in a USD 68.36-69.12/bbl parameter.


• Sticking with energy, European natural gas takes a breather after a three-day slide, with traders citing potential demand pockets across the world that could challenge Europe's efforts to stockpile ahead of winter.

Precious Metals: Gold -0.2%, Silver -0.1%, Palladium -0.3%

• Precious metals are taking a breather following yesterday's rise and with macro newsflow rather light ahead of the August 1st tariff deadline, which also coincides with the US jobs report and the ISM Manufacturing PMI.


• Ahead of this session, Fed Chair Powell is due to speak, but monetary policy comments will not be permitted as the central bank observes its blackout period ahead of next Wednesday's FOMC.


• Spot gold trades in a USD 3,344.90-3401.65/oz range after failing to sustain above USD 3,400/oz in APAC hours.

Base Metals: 3M LME Copper +0.1%

• Mostly but modestly subdued trade across base metals, although losses seem somewhat cushioned by the recent Chinese dam project, with iron ore prices overnight closing higher for a fifth consecutive session.


• Meanwhile, coking coal prices overnight surged by 8%, hitting the daily limit. Some cited unverified market chatter that the Chinese National Energy Administration has reportedly issued a verification notice requiring all mines that have exceeded production capacity to suspend operations for rectification.


• 3M LME copper meanwhile trades flat in a notably narrow USD 9,827.70-9,883.00/t range at the time of writing.

22 Jul 2025 - 09:55- ForexGeopolitical- Source: Newsquawk