EUROPEAN COMMODITIES UPDATE: Crude prices caged while metals trim advances as DXY gains
Analysis details (10:30)
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WTI and Brent front-month futures are choppy amid the broader cautious mood across the markets. Oil prices declined on Monday following the recent weak Chinese Manufacturing PMI, which comes as the market is away on its Golden Week holiday. WTI June resides around USD 75.50/bbl (in a 75.10-76.11/bbl range) while Brent July sits just above USD 79/bbl (in a USD 78.81-79.78/bbl range). The morning saw the earnings release from oil major BP, which sees Q2 refining margins below Q1 amid weaker middle distillate margins. Desks in recent weeks have been attributing at least some of the weakness in crude markets to demand concerns arising from weaker refinery margins. BP expects oil prices to remain elevated as the recent decision by OPEC+ to restrict production, combined with strengthening Chinese demand, tightens supply/demand balances. The oil major also expects Q2 European gas and Asian LNG prices to be supported by recovering Chinese gas demand, re-stocking of European storage capacity and coal-to-gas switching. In the US, Henry Hub gas prices are also expected to find support from coal-to-gas switching in the power sector. - Elsewhere, metals are mixed, with spot gold now lower but caged to a tight range as the DXY hits fresh session highs while the market mood remains cautious. Base metals are now mixed after initially seeing broad-based gains, 3M LME copper pulled back from a USD 8,714/t session high closer towards its USD 8,603/t current low.
02 May 2023 - 10:30- MetalsData- Source: Newsquawk
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