EUROPEAN COMMODITIES UPDATE: In-fitting with broader market action ahead of a busy PM docket

Analysis details (10:35)

• A contained session for the commodity space with markets generally tentative and mixed awaiting the afternoon’s risk events of which the ECB takes centre stage. As it stands, the crude benchmarks are essentially unchanged on the session and have slipped marginally from best levels of USD 88.50/bbl and USD 96.20/bbl for WTI Dec’22 and Brent Jan’22 respectively amid a slight resurgence in the Dollar; for reference, today’s crude highs are the current WTD peak.


• Newsflow explicitly for the energy complex has been light aside from via corporate updates, which saw Shell post one of their best quarters on record after which the CEO remarked that he expects oil price volatility to continue into 2023 and that the industry should be prepared to accept higher taxes. Similarly, TotalEnergies posted a strong update with particularly attention on LNG performance. Within this, surmising that they started production at the Ikike field in Nigeria, launched the Begonia project in Angola and the Fenix project in Argentina, and announced a significant gas discovery in Cyprus


• Moving to metals, spot gold spent much of the morning firmer as the DXY waned below 110.00, but as the index reclaims the figure the yellow metal has been tarnished in turn and has slipped back below the 21-DMA at  USD 1667/oz but remains around USD 10/oz from the 10-DMA at USD 1648/oz. Gold aside, iron ore is pressured by circa. 12% in a period of just over 10 days amid its correlation to China’s performance as the region remains subject to COVID concerns and some fresh uncertainty following the concentration of power in President Xi post-CCP. Elsewhere, Anglo American’s Q3 production update including a 6% YY decline in copper output, though the name caveats that their new facility in Peru is continuing to increase production.

27 Oct 2022 - 10:35- Research Sheet- Source: Newsquawk