EUROPEAN COMMODITIES UPDATE: Energy prices are buoyed by supply-side risks while metals are more subdued

Analysis details (09:43)

• WTI and Brent front-month futures trade firmer intraday amid some supply-side updates over the weekend, including from the Gulf of Mexico and Australia. To recap on the former, the National Hurricane Centre said the system in the Gulf of Mexico has a high chance of formation. Tropical storm watches or warnings may be necessary on Monday, NHC said, with the hurricane map showing a disturbance heading straight for Texas, followed by several tropical storms in the area, which could disrupt export routes. The oil complex may also be feeling a boost from the Australian LNG update which has propped up natgas prices this morning. 


• Upside in gas is attributed to reports unions at Woodside Energy's North West Shelf offshore gas platforms "unanimously endorsed" giving 7 working days' notice to strike if bargaining claims are not met by Wednesday (August 23rd), according to Reuters. The Offshore Alliance, consisting of two key unions, will also finalise a strike vote at Wheatstone and Gorgon LNG ventures (operated by Chevron) by Thursday (August 24th). Sources at the two LNG companies, cited by Reuters, believe some form of industrial action is likely in the coming weeks. 


• WTI Sept sits just under USD 82/bbl (vs low USD 81.07/bbl), while Brent Oct trades around USD 85.50/bbl (vs low USD 84.52/bbl).


• Over to metals, spot gold moves in tandem with the Buck with the yellow metal remaining sub-USD 1,900/oz and not far from last week’s USD 1,886.70/oz trough, with participants eyeing Dollar and bond yield action in the run-up to the Fed’s Jackson Hole Symposium. Base metals gave up the modest gains seen earlier in the European morning despite a relatively steady Dollar and quiet news flow, with 3M LME now lower but still holding onto the USD 8,200/t mark after falling from an intraday peak above USD 8,300/t.

21 Aug 2023 - 09:43- MetalsEU Research- Source: Newswires