EUROPEAN COMMODITIES UPDATE: Crude off its lows but metals see a downside bias ahead of US CPI

Analysis details (10:45)

WTI and Brent futures are choppy with relatively modest intraday gains following yesterday’s China-induced weakness - which resulted in both front-month contracts settling lower by some USD 0.50-0.60/bbl. The focus has largely been on China’s fluid COVID situation, with Beijing also seeing a jump in cases over the last 24 hours. Tensions are also heating up with regard to the Iranian Nuclear Deal after Tehran turned off several IAEA-linked cameras at nuclear sites. Iran reiterated that the US needs to concede some ground to clinch a deal, whilst Washington has not indicated that it is willing to. “A restoration of the JCPOA in its original form could add 1.3mn-1.4mn b/d of Iranian crude to global supplies within 6-9 months of its implementation,” Argus Media says. In terms of other supply-side updates, Libya’s key oil ports Es Sider & Ras Lanuf are reportedly to shut down, whilst a US State Department summit advisor said Venezuelan oil won't be on the market anytime soon. At the time of writing WTI Jul’ resides just under USD 122/bbl (vs low 120.09/bbl), whilst Brent Aug’ trades around USD 123.50/bbl (vs low 121.60/bbl). Meanwhile, metals markets are relatively tentative and uneventful - spot gold trades on either side of its 21 DMA (1,844/oz), while base metals similarly hold a mild downside bias on the LME as the Dollar recovers from early losses ahead of US CPI.

10 Jun 2022 - 10:44- MetalsData- Source: Newsquawk