EUROPEAN COMMODITIES UPDATE: Mixed trade with crude in a tight parameter ahead of OPEC+

COMMODITIES

WTI/Brent: +0.4%/+0.4%

• Relatively flat trade within a tight parameter in the run-up to the delayed OPEC+ meeting slated for tomorrow at 11:30 GMT, according to Energy Intel.


• Prices remain underpinned after OECD raised 2025 forecasts for global growth, US growth, and Chinese growth, although Chinese Caixin Services PMI missed overnight.


• Bulls remain cautious after the latest private sector inventory data (Crude +1.2mln vs exp. -0.7mln) which showed a surprise build in headline crude stockpiles - with traders awaiting confirmation from the weekly DoEs.


• Geopolitical updates saw Iran's Deputy Foreign Minister of Political Affairs yesterday reportedly warning of possible NPT withdrawal (a multilateral treaty that aims to limit the spread of nuclear weapons) if the UN ‘snapback’ mechanism is triggered, via IRNA citing a top lawmaker.


• Elsewhere, amidst fears of an unravelling ceasefire between Lebanon's Hezbollah and Israel, a Lebanese government source suggested the Israel-Hezbollah ceasefire agreement "will endure and not collapse despite all the shocks it has experienced since its announcement", and "The agreement was not forged so that it would collapse within a few days." That being said, it was recently reported "Israeli forces opened fire on Lebanese army forces during their inspection of the port of Naqoura", according to Al Arabiya.


• Ahead, the OPEC+ meeting will likely be the focus for the oil complex, although sources already suggested that the group will likely extend its supply cuts until the end of Q1 2025 (prev. Q4 2024) - with compliance complicating matters.


• Brent Feb trades in a USD 73.54-74.17/bbl range and WTI Jan in a USD 69.87-70.43/bbl parameter.

Dutch TTF: -1.7%

• Pulling back after settling higher by 2.4% with desks citing supply concerns and stronger draws in storage thus far in the winter season; "Storage is a little more than 85% full, which is below the 5-year average of almost 88% full", says ING.


• Focus turns to year-end transit of Russian gas via Ukraine which is due to stop at the end of the year.


• Dutch TTF Jan'25 futures fell back under EUR 48/MWh to trade in a current EUR 48.15-47.55/MWh band.

Spot Gold: -0.1%

• Precious metals are generally subdued intraday against the backdrop of a slightly firmer Dollar, whilst major newsflow for the yellow metal remains sparse in the run-up US ISM Services PMI, Fed Chair Powell, and then Friday's US Jobs data.


• Geopolitical updates are also on watch amid a seemingly feeble Israel-Hezbollah ceasefire, whilst an Israel-Hamas ceasefire sees no updates at the time of writing.


• Spot gold resides in a tight USD 2,636.73-2,651.45/oz parameter and within yesterday's USD 2,634.17-2,655.66/oz.

3M LME Copper: -0.3%

• Mostly subdued trade across base metals amid a slightly firmer Dollar, but despite a mildly firmer risk tone elsewhere.


• Dalian iron ore ended morning trade -0.2% whilst SGX iron ore dipped 0.7% - traders cite escalating trade tensions between the US and China.


• Downside is limited ahead of the China Economic Work Conference (Dec 11/12th) amid hopes of fiscal stimulus.


• 3M LME copper trades in a narrow USD 9,076.50-9,133.50/t range.

04 Dec 2024 - 10:20- ForexGeopolitical- Source: Newsquawk