EUROPEAN COMMODITIES UPDATE: USD provides support to metals while crude remains contained

Analysis details (10:40)

• Overall, a session without specific macro drivers with commodity action relative contained and somewhat directionless aside from a very modest USD-induced upward bias.


• For crude, action is even more contained than the broader complex. Currently, WTI and Brent are pivoting the neutral point of a sub-USD 0.50/bbl range that is by extension well within, but at the top-end of, Wednesday’s much more pronounced boundaries. Specific fundamentals are essentially non-existent once again with the few geopolitical updates incremental at most, though the docket does feature the OPEC MOMR which is due at 12:30BST/07:30ET. As a reminder, the April EIA STEO saw the world oil demand forecast cut by 40k BPD to a 1.44mln BPD Y/Y increase while the 2024 forecast was raised by 60k BPD to a 1.85mln BPD Y/Y increase. On the OPEC front, the EIA wrote that the cartel's production is to fall by 500k BPD in 2023 and will then increase by 1mln BPD in 2024, after the output agreement expires.


• Moving to metals, the complex continues to grind higher and is deriving support from a softer USD and perhaps on the positive read into the Chinese demand situation via LVMH’s strong Q1 report. Turning to spot gold, which has eclipsed Wednesday’s USD 2028/oz peak though remains just shy of April’s USD 2031/oz best; action which, as mentioned previously, continues to lift the metal above its 10-DMA which has climbed to USD 2001/oz.

13 Apr 2023 - 10:43- MetalsResearch Sheet- Source: Newsquawk