EUROPEAN COMMODITIES UPDATE: Subdued trade in energy but base metals tilt higher

WTI/Brent: WTI Feb -0.1%/ Brent Mar -0.1%

• A subdued session for the crude complex thus far as the dollar holds an upward bias, with broader sentiment also flimsy following this week's hot US data, UK bond market turmoil, and tariffs threats ahead of US President Trump's inauguration.


• Furthermore, the demand side of the equation has been disappointed by the underwhelming support from China. Analysts at ING posit "Given the lull after September’s monetary easing flurry, markets understandably remain cautious, but signs are that policymakers stand ready to respond to potential shocks in 2025."


• Add to that, today marks the US federal holiday for former President Carter's funeral, thus volumes are likely to be anemic throughout the session.


• WTI Feb resides in a USD 72.84-73.50/bbl while Brent Mar sits in a USD 75.68-76.36/bbl parameter.

Nat Gas Dutch TTF -1%/ US Nat Gas -0.9%

• Gas markets tilt lower in tandem with the broader energy complex, and with European gas traders keeping an eye on supply while US gas participants focus on the winter weather in the region currently keeping prices elevated.


• ING: "Forecasts for colder weather in early January mean that gas storage could fall at a quicker pace, leaving storage to fall further below the five-year average. EU storage is 70% full, down from 85% last year and below the five-year average of 76%."


• Dutch TTF Mar trades on either side of EUR 45/MWh while US Nat Gas remains above USD 3/MMBtu.

Gold: +0.1%

• Precious metals hold an upward bias across the board, albeit modestly, with some demand seen given the cautious risk tone across markets, and with little action seen on the FOMC minutes yesterday.


• Spot gold resides in a current USD 2,655.63-2,666.98/oz range vs yesterday's USD 2,645.37-2,670.15/oz, with the 50 DMA seen at USD 2,650/oz.

Copper: +0.6%

• Copper futures remain underpinned following yesterday's advances and after Chinese CPI data printed in line with expectations overnight. Gains were maintained throughout the European morning thus far despite the resilient dollar and cautious risk tone.


• Elsewhere, it was reported that Chile's Codelco copper production reached 1.328mln metric tonnes in 2024 (vs 1.325mln metric tonnes in 2023).


• 3M LME copper remains north of USD 9,000/t in a current USD 9,029.50-9,103.00/t parameter.


• Overnight, Dalian iron ore futures ended daytime trade +0.5% with participants citing demand from steel mills.

09 Jan 2025 - 10:15- ForexEU Research- Source: Newsquawk