EUROPEAN COMMODITIES UPDATE: Upward bias in industrial commodities while precious metals await US jobs

Crude Oil: WTI Mar +0.6%,Brent Apr +0.6%

• Crude futures overnight attempted to pick themselves up from the prior day's trough after prices were dragged lower by comments from US President Trump who stated they would drive the price of oil down and everything else would follow, while he also said they are making good progress to stop the Russia-Ukraine war.


• Newsflow was light this morning but Iran delivered some punchy rhetoric in which Leader Khamenei said talks with the US are neither smart, wise, nor honourable, according to IRNA.


• Elsewhere in geopolitics, "Al-Arabiya sources: Hamas informed mediators that Israel did not abide by the agreed humanitarian protocol" and as such Hamas is "Delaying the names of hostages scheduled to be released tomorrow".


• The focus today will be on the US jobs report.


• WTI Mar sits in a USD 70.47-73.33/bbl range while Brent Apr resides in a USD 74.26-75.12/bbl parameter.

Precious Metals: Gold -0.3%, Silver -0.9%, Palladium +0.2%

• Spot gold remains afloat but within yesterday's ranges as the yellow metal bides times ahead of the US Jobs reports.


• Citi yesterday said it expects gold prices to stay elevated this year and potentially reach the USD 3,000/oz level.


• Analysts at ING have also joined the call for USD 3,000/oz prices this year, suggesting the round figure is now in sight due to rising safe-haven demand, central bank buying, and geopolitical uncertainty under Trump. Interest rate cuts and ETF inflows could further boost prices.


• China's Financial Regulator will allow insurance funds to purchase gold as part of a pilot project - modest upticks in prices were seen around this time.


• Spot gold resides in a current USD 2,855.98-2,870.73/oz parameter and within yesterday's USD 2,834.27-2,873.34/oz confines.

Base Metals: 3M LME Copper +0.7%

• Copper futures overnight edged mild gains amid the positive risk sentiment seen in its largest buyer, with traders now looking ahead to the US jobs report.


• 3M LME copper resides in a USD 9,295.97-9,433.00/t range.


• One of the biggest macro drivers next week could be an escalation or easing in US and China trade tensions, with the Chinese levies on the US set to take effect. As a reminder, the US’ new 10% tariff on all Chinese exports to the US took effect after the deadline passed on February 4th. In retaliation, China imposed 15% tariffs on US coal & LNG, and 10% tariffs on US oil, agricultural machines, and some autos, set to take effect on February 10th.

07 Feb 2025 - 10:00- MetalsGeopolitical- Source: Newsquawk