EUROPEAN COMMODITIES UPDATE: Crude trades with no firm direction but metals wane as the Buck picks up

Analysis details (09:39)

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  WTI and Brent March futures trade with no firm direction after the contracts settled flat yesterday, with little in terms of crude-specific catalysts to drive price action. The benchmarks remain underpinned by Chinese demand following the reopen, and during the Chinese Lunar New Year – often dubbed as the largest annual human migration event. In terms of geopolitics, punchy rhetoric continues to emanate from Russia after some western nations equipped Ukraine with tanks, with Russia’s Kremlin stating that it sees the sending of Western tanks to Ukraine as direct and growing involvement in the conflict, whilst the Russian Security Council's Secretary Patrushev said the US and NATO are participating in the Ukrainian conflict and want to prolong it. This morning, explosions have been reported in the Ukrainian capital of Kyiv, with power also reported being offline. Over in Europe, TotalEnergies said pension reforms strike action is interrupting shipments at French production sites, except for the Feyzin refinery (119k BPD). The co. continues to ensure petrol stations are supplied, with no shortage reported thus far. WTI and Brent futures trade around USD 80/bbl and USD 86/bbl respectively, both within USD 0.80/bbl intraday ranges.


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  US Nat Gas and Dutch TTF futures see a divergence this morning, with the former extending losses under USD 3/MMBtu, whilst the latter sees modest gains. Analysts at ING suggest that the decline in US Nat Gas is due to milder weather resulting in a much more modest drawdown of gas storage than usually seen at this time of the year.


• Over to metals, spot gold has been waning off best levels amid the recent yield-driven Dollar strength. Overnight, the yellow metal topped yesterday’s USD 1,947.94/oz peak before encountering resistance just under USD 1,950/oz, with eyes set on today’s US GDP data ahead of tomorrow’s monthly PCE. Base metals are off best levels amid the recent Dollar strength, but 3M LME copper holds its ground above USD 9,300/t after briefly eclipsing USD 9,350/t overnight.

26 Jan 2023 - 09:40- MetalsData- Source: Newsquawk