EUROPEAN COMMODITIES UPDATE: Precious metals take a breather, US-India deal boosts crude higher

Crude Oil: WTI +1.8%, Brent +1.7%

• Crude benchmarks extended on Tuesday’s high during the APAC session as Mint citing sources reported that a US-India trade deal is near, that could see India cut Russian oil imports for a lower export tariff to 15-16% from 50%. WTI and Brent peaked at USD 58.50/bbl and USD 62.62/bbl respectively following the trade news but are currently trading slightly off best levels at USD 58.20/bbl and USD 62.30/bbl.
• Planning for a second Trump-Putin meeting has been postponed despite a “positive meeting” between US Secretary of State Rubio and Russian Foreign Minister Lavrov. The US President reiterated his desire to see current battlefield lines frozen as part of the ceasefire agreement, but the Kremlin continues to reject it.
• More recently, the Russian Deputy Foreign Minister has outlined that summit preparation continues and he does not see any major obstacle for a leaders meeting.
• Overnight, Russia continues to attack Ukraine, with Ukrainian President Zelensky saying 10 regions were attacked with energy infrastructure being the primary target.
• Crude stocks are expected to build 3.524mln as the EIA reports its weekly crude stockpile. Private inventory data late in Tuesday’s session saw an unexpected draw of -3mln barrels of crude.

Precious Metals: XAU -0.9%, XAG -0.2%

• Spot XAU is taking a breather this morning following Tuesday’s 5% selloff, which was its biggest selloff since November 2020. XAU briefly continued lower to a trough of USD 4003/oz before rebounding to a high of USD 4161/oz.
• The pullback from ATHs came as positive US-China sentiment, dollar strengthening and demand for the metal falling as the Diwali season ended. To add, there have been hopes from Republicans that the government shutdown could end this week and another vote is expected later today, though the prospect of a breakthrough remains a slim one

Base Metals: 3M LME Copper +0.4%

• Base metals have rebounded from Tuesday’s selloff following a trade deal near its completion between India and the US. 3M LME Copper dipped to a low of USD 10.54k/t before reversing a trending back through Tuesday’s range and is currently trading near session highs at USD 10.66k/t.