EUROPEAN COMMODITIES UPDATE: Subdued trade across commodities with focus on the Trump-Xi call

Crude Oil: WTI Oct -0.6%; Brent Nov -0.4%

• Futures remain subdued following a similar APAC session and after the choppy performance seen during the prior day.


• Headwinds were seen yesterday following US President Trump's comments on oil, suggesting there is a lot of oil left in the North Sea and oil prices need to come down further. Trump also repeated the call for countries to stop buying from OPEC+ members.


• There were also reports that the EU is said to be planning to phase out Russian LNG quicker than expected - the Spanish Economy Minister this morning noted Spain is making progress in reducing LNG purchases from Russia.


• EU is reportedly considering a provision in the 19th sanctions package against Russia to phase out Russian LNG purchases a year earlier than currently planned, via Bloomberg citing sources.


• Elsewhere, the Iranian Deputy Foreign Minister said actions by European nations to reimpose sanctions would be politically biased and a pretext for escalation - sanctions are due to be effective at the end of the month.


• Sticking with the Middle East, Israeli PM Netanyahu indicated the Israeli offensive will continue, and said, "We will strike Hamas hard, we will not stop, and we will not end this war until we achieve all our goals".


• Aside from the above, notable newsflow has been light, with the crude complex also weighed on by a firmer dollar, whilst sidelining the positive sentiment across Europe.


• Focus today on the Trump-Xi call. The call could tee up a face-to-face meeting between the leaders. The discussion is expected to cover tariffs, geopolitics, TikTok, and semiconductors. Tariffs are a key focus as the 90-day truce expires in November, with prior US tariffs on China reaching 145% and potential Chinese export restrictions affecting US tech. Geopolitics may include US pressure on allies over Russian energy purchases, including reports that Trump asked the EU to impose 100% tariffs on China and India.


• WTI currently resides in a tight 63.15-63.65/bbl range while Brent sits in a USD 67.11-67.57/bbl range.


• Meanwhile, Dutch TTF prices rose for three straight sessions. Analysts at ING posit "EU storage is now 81% full, down from 93.4% at the same time last year and below the five-year average of 87.6%. The expectations for cooler weather in northwest Europe over the coming week might slow down the fuel injections, as the region braces for the start of the heating season."

Precious Metals: Gold +0.3%, Silver +1.7%, Palladium +0.9%

• Precious metals are mixed with spot gold, gradually edging higher overnight before falling victim to the USD once again, following the same headwind yesterday.


• Volatility in the yellow metal was seen during the China open, albeit this was short-lived, whilst some upticks were seen during the BoJ announcement as the firmer JPY pushed down the USD at the time.


• The main focus today will be on a call between Presidents Trump and Xi, who are due to speak at 14:00BST/09:00EDT. The call marks their first leader-level engagement since June and potentially sets the stage for an in-person meeting later this year, possibly at the APEC summit in South Korea (which runs from October 31st to November 1st). The discussion is expected to cover tariffs, geopolitics, TikTok, and semiconductors. Tariffs are a key focus as the 90-day truce expires in November, with prior US tariffs on China reaching 145% and potential Chinese export restrictions affecting US tech. Geopolitics may include US pressure on allies over Russian energy purchases, including reports that Trump asked the EU to impose 100% tariffs on China and India. TikTok divestment, NVIDIA’s dual pressures from US restrictions and a Chinese antitrust probe, and potential Chinese Boeing orders are also anticipated topics.


• Spot gold currently resides in a USD 3,632.38-3,661.35/oz range, well within yesterday's USD 3,627.96-3673.20/oz parameter.

Base Metals: 3M LME Copper +0.3%

• Mixed trade across base metals this morning, with the red metal overnight trading rangebound near this week's trough amid the ultimately mixed risk appetite in Asia.


• The main focus today will be on a call between Presidents Trump and Xi, who are due to speak at 14:00BST/09:00EDT (details above).


• Overnight, iron ore futures advanced and notched the fourth weekly gain, with traders citing improved steel demand ahead of the week-long Chinese holiday at the start of October.

19 Sep 2025 - 10:00- ForexGeopolitical- Source: Newsquawk