EUROPEAN COMMODITIES UPDATE: Industrial commodities are under broad risk-related pressure while spot gold struggles to top USD 2,000/oz

Analysis details (09:54)

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  Crude futures have added to the losses seen during the APAC session, with pressure seemingly a factor of the soured risk sentiment coupled with broader growth concerns – WTI and Brent June futures are under USD 78/bbl (vs high 79.07/bbl) and USD 82/bbl (vs high 82.92/bbl) respectively. News flow for the complex has been on the lighter end while the leg lower in European trade coincided with declines across equities. Analysts at ING also highlight the weakness seen in refining margins – which “is not a great demand signal and this weakness could start to see refiners trimming run rates”, according to the desk. Elsewhere, eyes remain on the oil flows via the Turkish Ceyhan terminal, which remains halted despite the Iraqi PM suggesting flows could resume this week - some 450k BPD of supply still reportedly shuttered from the market following the halt of flows in late March. Elsewhere, nat gas prices are flat with a mild upside bias amid the softer Dollar, and around recent ranges, with upside capped by the losses across crude oil futures.


• Over to metals, spot gold is struggling to reclaim and hold above USD 2,000/oz despite the weaker greenback, with the yellow metal currently sandwiched between its 10 and 21 DMAs at USD 2,004.63/oz and USD 1,993.02/oz respectively – with Bloomberg citing the capped upside to traders betting on further monetary policy tightening. Base metals are also mostly lower despite the subdued dollar, with the losses consistent with the narrative of growth fears – 3M LME copper falls more convincingly under USD 9,000/t with a current lower around USD 8,839.50/t. Meanwhile, iron ore prices saw recent weakness, with losses yesterday attributed to China’s NDRC stating that it will crack down on unreasonable price gains in the iron ore market while adding it will strengthen exploration of domestic resources, speed up project building, and improve steel recycling.

20 Apr 2023 - 09:55- MetalsResearch Sheet- Source: Newsquawk