EUROPEAN COMMODITIES UPDATE: Crude trundles lower, but metals mostly fare better

Analysis details (11:06)

WTI and Brent June futures continue drifting lower, with the former back under USD 97.50/bbl (high 99.82/bbl) whilst the latter moves back closer to USD 101/bbl from the overnight peak of 103.90/bbl – which was set as APAC trader reacted to Russian Foreign Minister Lavrov who warned the risks of a nuclear war are serious and suggested that NATO is essentially engaging into war with Russia through a proxy. On the other side of the coin, the crude complex continues to be dampened by China's COVID situation, with Beijing now at risk of seeing stricter controls after one area was deemed "high-risk". China's COVID conundrum has impacted the demand side of the crude equation as activity diminishes. Shanghai's woes have also hit supply chains - US trucking giant JB Hunt believes that Shanghai's lockdown will spell trouble for US ports by July, suggesting the problem could extend the high shipping prices and product shortages as ships are being loaded/unloaded at a slower pace. On this note, shipping giant Maersk has also revised downwards its outlook for growth of global container demand from 2-4% to -1/+1%. On the Ukraine front, eyes remain on how the EU (namely Germany) will approach independence from Russian Energy. FT sources suggested the EU is reportedly mulling a cap on prices paid for Russian oil as a way to hit Russia's revenues. Elsewhere, spot gold was pressured by the firmer Buck and fell to a current intraday low of USD 1,894/oz in early trade before finding a base and reclaiming a USD 1,900/oz handle with little new to report. Base metals, meanwhile, are mostly firmer in what is seemingly a rebound following yesterday's downside. Over in China, the Shanghai Futures Exchange raised its trading limits and margin requirements for steel rebar, wire rod, and hot rolled coils futures from settlement on April 28th.

26 Apr 2022 - 11:06- MetalsResearch Sheet- Source: Newsquawk