EUROPEAN COMMODITIES UPDATE: Crude sees modest pressure, gold is indecisive above USD 1,700/oz, but base metals rebound

Analysis details (10:52)

WTI and Brent September futures are softer intraday after settling higher in the prior session. News flow for the complex has been somewhat sparse since, with the fundamentals unchanged. Analysts at ING flag the time spread between the Sep and Oct contracts, which “has traded to a backwardation of almost USD 4.50/bbl - highlighting the tightness that still persists in the oil market.” WTI resides just under USD 100/bbl whilst Brent trades just above USD 106/bbl. Gas markets await in anticipation of what will happen following the maintenance period for Nord Stream 1 which ends tomorrow. A German government spokesperson suggested Germany is under the assumption gas will flow again, but just yesterday, it was reported the European Commission does not expect Nord Stream to restart. President Putin has suggested that gas flows via the pipeline could fall further, from around 60mcm a day to 30 mcm a day if a turbine is not replaced quickly. Meanwhile, the European Commission has set a voluntary target to reduce gas demand by 15%. Over to metals, spot gold holds onto a USD 1,700/oz handle but has been caged in recent trade amid the cautious mood. Finally, base metals are mostly firmer with 3M LME copper re-eyeing the USD 7,500/t mark – with Antofagasta also cutting their FY copper production guidance this morning.

20 Jul 2022 - 10:52- MetalsResearch Sheet- Source: Newsquawk