EUROPEAN COMMODITIES UPDATE: Initial strength in crude now pared amid potential ceasefire efforts; XAU pressured

WTI/Brent: -0.4%/-0.5%

• Benchmarks initially posted gains, though are now subdued, lower by around USD 0.2/bbl, Brent within a USD 73.52-78.32 range.


• Most recently, crude saw fleeting support on remarks from Iran's Foreign Ministry, which said parliament is preparing a bill to leave the Nuclear Non-Proliferation Treaty. However comments after, noted that Tehran remains opposed to weapons of mass destruction - it seems as though initial gains were pared on this comment.


• Initial crude strength was led by weekend attacks on Iranian nuclear and gas facilities, this strength has since pared, potentially amid; commentary from the US President, who said “many calls and meetings are taking place for a peace deal between Iran and Israel”, and some desks also noting no supply impact from Israeli attacks so far.


• As there are so many updates, we will focus on those energy-specific. Over the weekend, Israeli drones targeted a number of energy assets, including Iran’s South Pars Gas Refinery, forcing the shutdown of a production platform at the world’s largest gas field. ING notes that the attack was concentrated on its domestic energy system, rather than exports to international markets. Additionally, Kpler's Bakr said there are no signs of disruptions in oil loadings from Iran, she added that without a supply outage, there will be no need from anyone to add more barrels onto the market (OPEC+)


• On diplomacy, US President Trump posted on Truth Social on Sunday: "Iran and Israel should make a deal, and will make a deal...we will have PEACE, soon, between Israel and Iran! Many calls and meetings now taking place."


• Mediation efforts to stop the war with Iran had begun, according to Yedioth Ahronoth citing an Israeli official. Yedioth Ahronoth quoted an Israeli official as saying there was no good proposal yet to stop the war with Iran.


• One Israeli official told Axios that Israel was not interested in a ceasefire at that time because it had not yet achieved all of its goals, particularly in destroying Iran's nuclear programme. Israeli officials said there was currently no serious diplomatic initiative to stop the war with Iran.

Gold: -0.5%

• Spot Gold is in the red and trickling further away from its USD 3500/oz ATH.


• The yellow metal is moving in tandem with crude, and unusually, the Dollar, on value concerns as traders digest weekend updates, with commentary from the US President potentially aiding.


• The yellow metal trades within USD 3,409-3,451/oz parameters.


• Elsewhere, Goldman Sachs maintained its forecast that "structurally strong central bank purchasing" will increase the gold price to USD 3,700/oz by the end of the year and USD 4,000 by mid-2026.

3M LME Copper: +0.3%

• Copper futures are modestly in the green and, unlike the yellow metal, are benefitting from a softer dollar (DXY -0.3%).


• The industrial trades within a range of USD 9,607-9,705/oz, and currently nears session highs.

16 Jun 2025 - 10:00- ForexGeopolitical- Source: Newsquawk