EUROPEAN COMMODITIES UPDATE: Crude to an incremental WTD peak, geopols remain in focus, metals tentative

WTI/Brent: +0.3%/+0.3%

• In the green, with session bests of USD 69.92/bbl and USD 73.93/bbl for WTI and Brent respectively, highs which are also fresh WTD peaks. However, we have since faded from those marks with fundamentals behind the pullback light and the action potentially a function of a failure to test/surpass the psychological levels just above.


• Benchmarks lacked direction overnight, with geopolitics in APAC hours of note but not moving the macro dial while the private inventory report was mixed, showing a larger-than-expected crude build and a surprise drawdown in gasoline.


• On Russia-Ukraine, the main update has been a Reuters source piece that Russian President Putin is reportedly open to talking about a Ukraine ceasefire with US President-elect Trump, but rules out making any major territorial concessions. An update which was followed by the Kremlin saying that Putin is always open to talks but freezing the conflict doesn't suit them.


• Elsewhere, updates out of Iran, US and Hezbollah on the Middle-East but nothing that has fundamentally moved the dial thus far.


• Finally, Equinor’s Johan Sverdrup oilfield (775k BPD peak) output capacity has been fully restored following Monday’s power outage.

Gold: -0.4%

• In the red, though only modestly so, and still comfortably clear of Tuesday’s USD 2610/oz base and by extension significantly above Monday’s USD 2562/oz base.


• Lower having faded gradually from an incremental fresh WTD high of USD 2641/oz, last week’s USD 2686/oz peak is the next point of resistance if upside re-emerges.


• Pressure which comes as geopolitics is yet to significantly re-intensify with havens generally on the back foot (fixed, JPY & CHF pressured) and as the DXY is bid and extends above 106.50.


• Geopolitics aside, updates from the session’s Fed speakers will draw focus and be scoured for fresh direction.

Copper: +0.3%

• Firmer, but only modestly so. Benefitting from the general rebound in risk sentiment though given this is cautious and tentative so far base metals are exhibiting similar action.


• Overnight trade was much the same, with cautiousness/indecisiveness in China trade capping any real gains for base metals.


• 3M LME copper is in the green but only modestly so holding in a narrow USD 9.12-9.17k band, in the green for the week but yet to make any real advance and still markedly shy of last week’s USD 9.48k opening mark and the 9.49 high just above.

20 Nov 2024 - 10:20- ForexGeopolitical- Source: Newsquawk