EUROPEAN COMMODITIES UPDATE: Demand hits crude but base metals trade mixed amid hopes of Chinese support

Crude Oil: WTI May -2.9%/Brent Jun -2.8%

• A subdued session for the crude complex as Trump's retaliatory tariffs came into effect, whilst the complex also juggles OPEC's decision to bring forward the return of barrels.


• A modest bounce off lows was seen as Chinese stocks surged at the time, whilst reports shortly after suggested China's top leaders are to hold a meeting as soon as Wednesday (today) to discuss measures to boost the economy after US trade tariffs, via Reuters citing sources. Some of the measures could be implemented in the coming weeks, the sources added. Chinese monetary and fiscal stimulus is unlikely to fully protect the Chinese economy from the severe downturn in global demand caused by tariffs, according to Reuters sources.


• Crude futures remain pressured amid the broad risk-off environment seen in Asia-Pac and Europe, with prices not helped by mixed private sector inventory data despite the surprise draw in headline crude stockpiles.


• US Private Inventory Data (bbls): Crude -1.1mln (exp. +1.4mln), Distillate -1.8mln (exp. +0.3mln), Gasoline +0.2mln (exp. -1.5mln), Cushing +0.6mln.; traders await the weekly DoE metrics.


• Elsewhere, the Keystone oil pipeline in North Dakota was reportedly shut after a rupture, according to AP.


• In geopolitics, the Russian Foreign Ministry says Ukraine continues to strike Russian energy infrastructure on a daily basis.


• Despite the number of bullish factors outlined above, markets continue to be dominated by the macro tariff story which ultimately hampers global growth and in turn, the demand side of the equation; China is yet to release retaliatory measures.


• WTI May resides towards the bottom end of a USD 56.70-58.38/bbl range while its Brent counterpart trades towards the lows of a USD 60.13-61.53/bbl range.


• European nat gas contracts are lower across the board following the losses across the broader energy complex, whilst reports yesterday suggested EU countries showed support for gas storage leeway before winter, while the EU may agree on a 10% leeway on the 90% storage goal on Friday, according to Bloomberg citing sources.

Precious Metals: Gold +2.1%, Silver +1.1%, Palladium +0.6%

• Firmer across the board amid a flight to safety amid uncertainty surrounding tariffs, after the US imposed its reciprocal levies including a 104% tariff on China. China has not yet retaliated but suggested it is open to talks but will not back down.


• Spot gold resides in a current USD 2,969.97-3,052.46/oz range as it eyes Monday's peak (USD 3,057.30/oz), whilst the downside sees the 50 DMA (USD 2,953.10/oz).

Base Metals: 3M LME Copper -0.6%

• Mixed trade across base metal futures with the complex indecisive as it reacts to Trump's tariffs coupled with hopes of Chinese stimulus to counteract the effect of the levies.


• Goldman Sachs expects copper to drop to a monthly average low of USD 8.3k/T in Q3-2025. Forecast a 100k/T surplus in 2025 (prev. exp. 180k/T deficit). Forecasts skewed to the downside given risks to demand.


• Dalian iron ore ended daytime trade -2.7% with traders suggesting demand prospects were clouded by trade uncertainties.


• 3M LME copper is subdued within a USD 8,461.67-8,728.00/t range awaiting further trade updates.

09 Apr 2025 - 10:15- ForexGeopolitical- Source: Newswires