EUROPEAN COMMODITIES UPDATE: Downbeat trade across oil contracts but precious metals lifted; spot gold eyes USD 3,250/oz

Crude Oil: WTI Jul -0.8%, Brent Jul -0.8%

• Subdued trade across the crude complex amid the broader downbeat sentiment across markets emanating from Moody's downgrading the US' rating, for the first time in over a century, from AAA to Aa1 - which effectively put it in line with the ratings by S&P and Fitch.


• In APAC trade, crude futures were marginally lower in rangebound trade following quiet energy-specific newsflow and after somewhat mixed geopolitical-related headlines from over the weekend including the announcement of a Trump-Putin call scheduled for Monday, while there was criticism from Iran's Supreme Leader against US President Trump's 'disgraceful' remarks about being peace to the region. On that note, Iran's Deputy Foreign Minister said Iran-US nuclear talks will fail if the US insists on zero enrichment, according to NourNews.


• Sticking with the Middle East, Israeli PM Netanyahu said "Israel will 'take control of all' of the Gaza Strip", via AFP, which follows a renewed ground offensive in the region.


• Aside from that, complex-specific newflow has been light in the European morning, with WTI residing in a USD 61.22-62.44/bbl range while its Brent counterpart trades in a USD 64.69-65.60/bbl parameter.

Nat Gas: Dutch TTF +0.2%

• European natural gas trade flat/eke mild gains, marginally underpinned by reports that the EU will need to spend at least EUR 10bln more than last year to refill its gas reserves ahead of winter, after the first cold season in four years left its reserves heavily depleted, according to FT.


• Dutch TTF Jun'25 trades on either side of the EUR 35/MWh mark at the time of writing.

Precious Metals: Gold +1.0%, Silver +0.7%, Palladium +0.8%

• Positive trade across precious metals amid a leg lower in the dollar following the US sovereign rating downgrade by Moody's, which spurred a mild 'sell America' impulse.


• Spot gold rose from a USD 3,206.72/oz low to test USD 3,250/oz to the upside, albeit still within Friday's USD 3,154.30-3,252.25/oz range at the time of writing.

Base Metals: 3M LME Copper +0.3%

• Little action was seen across base metals amid the overnight release of mixed Chinese data, in which Industrial Production topped forecast but Retail Sales disappointed, while the latest House Prices continued to contract Y/Y albeit at a slightly slower than previous pace.


• The complex is largely underpinned by the aforementioned dollar weakness and is awaiting the next macro impulse.


• 3M LME copper currently resides in a USD 9,435.25-9,520.10/t range, albeit back under USD 9,500/t at the time of writing.

19 May 2025 - 09:55- MetalsGeopolitical- Source: Newsquawk