EUROPEAN COMMODITIES UPDATE: Crude subdued but metals underpinned by the softer Buck

Analysis details (10:31)

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  WTI and Brent front-month futures are subdued in early European trade despite the downbeat Dollar, firmer tilt to stocks and the above-forecast Chinese GDP metrics overnight. Some desks attribute the capped upside in the energy markets to more progress in negotiations between the Iraqi and Kurdish governments (reported overnight) which would see the resumption of oil flows via the Turkish Ceyhan export terminal. As a reminder, in March, oil flows of some 450k BPD were halted following a ruling by the International Chamber of Commerce in favour of the Iraqi government – which determined that the oil exports through Turkey were unauthorized. Aside from that, fresh fundamentals for the complex have been light this morning, although desks including JPM and Citi upgraded their Chinese GDP growth forecast in light of the Q1 figures, whilst Goldman Sachs maintained its forecast. WTI May trades around the USD 80/bbl mark (vs high USD 81.28/bbl) while Brent June sits around USD 84.50/bbl (vs high 85.28/bbl) – both near session lows.


• Elsewhere, nat gas prices on both sides of the pond are flat. US nat gas rallied over 7.0% yesterday – “Forecasts for colder-than-usual weather across parts of the US later in the week have boosted sentiment in the expectation of higher heating demand. In addition, we have seen record volumes of gas sent to LNG export terminals in recent days as they return to normal following the extended Freeport LNG outage”, analysts at ING posit.


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  Metal prices meanwhile are underpinned across the board by the waning Dollar. Spot gold is back on a USD 2,000/oz handle after briefly dipping under its 21 DMA yesterday (which today stands at 1,989.61/oz), but the yellow metal remains a way off yesterday’s 2,015/oz high yesterday, and before that the 10 DMA at USD 2,009.61/oz. Industrial metals hold modest gains, with underlying support from the above-forecast Chinese GDP metrics overnight, but 3M LME copper struggles to hold above USD 9,000/t after briefly topping the figure earlier in the day, whilst LME tin grinds higher amid the supply woes from earlier in the week.

18 Apr 2023 - 10:31- MetalsData- Source: Newsquawk