EUROPEAN COMMODITIES UPDATE: NHC and Offshore Alliance updates take centre stage

Analysis details (10:35)

• Crude benchmarks are a touch firmer with the broader macro narrative deriving impetus from Chinese stimulus, though brief pressure was seen as the USD printed a fresh intra-day peak. Elsewhere, gas is in the green though only modestly so as the Offshore Alliance now has the mandate from workers for potential strike action, but is yet to give notice for protected industrial action.


• Updates specifically for the crude space have largely been on the weather front, with the NHC updating on Hurricane Franklin (moving east, away from the US/Gulf) which has become the first Major Hurricane of the season. Additionally, Tropical Storm Idalia is expected to become a Hurricane at some point today as it intensifies within the Gulf on approach to the Florida coast. Elsewhere, the complex was unreactive to reports of an unspecified oil leak on a transmission pipeline between Genaveh, Iran and the Kharg Island, according to Tasnim.


• Currently, WTI & Brent Oct’23 are holding around USD 80.20/bbl and USD 84.75/bbl respectively, within relatively narrow sub-1/bbl parameters


• Back to natgas, the Offshore Alliance confirmed that following the Wheatstone offshore platforms vote today that it now has support for action across three of Chevron’s facilities and as such protected industrial action notices are set to be filed “shortly”. As a reminder, any strike action would require at least seven working days notice. Last week, Woodside Energy workers voted to approve strikes if necessary but came to an agreement with unions before a notice for protected action needed to be filed. Following the update, Dutch TTF Sep’23 saw modest upticks to post gains of circa. 2% on the session around the EUR 35 mark; a figure which is within recent parameters and as such is someway shy of the EUR 42.90+ high from last week.


• Moving to metals, spot gold is unchanged at the midpoint of USD 1913-1917/oz bounds and similarly to the USD is struggling for clear and lasting direction in limited UK Bank Holiday action ahead of the US session. Elsewhere, base metals are inching higher given the strong reaction in APAC trade to Friday’s Chinese support and subsequent equity-related guidance since.

28 Aug 2023 - 10:35- MetalsEU Research- Source: Newsquawk