EUROPEAN COMMODITIES UPDATE: Crude climbs amid numerous bullish factors, but is yet to breach Monday's best

WTI/Brent: +0.9%/+0.9%

• A slightly choppy morning for crude benchmarks but underlying action is firmly bullish with WTI & Brent at the top-end of parameters and within proximity to yesterday’s USD 69.11/bbl and USD 72.89/bbl best. Complex benefitting from both energy- and geopolitical-related developments.


• Updates overnight incl. reports that OPEC is likely to extend its latest oil output cuts until the end of Q1-2025, according to OPEC+ sources cited by Reuters. The JMMC and OPEC+ gatherings are currently set for December 5th.


• Elsewhere, Iraq halted all operations at the Basra oil refinery (~280k BPD) due to overloaded fuel oil storage tanks. More recently, and also a bullish input, Exxon (XOM) reported a unit upset at its Joliet refinery (275k bpd).


• Geopols remain in focus with the main update this morning potentially being an Israeli aircraft reportedly attacking a vehicle near Aqraba, Damascus, according to Kann's Kais. Overnight, the Lebanon ceasefire came under further pressure as Israeli PM Netanyahu said Hezbollah firing at Har Dov is a serious violation and they will respond strongly.

Gold: +0.3%

• At the top-end of a relatively narrow c. USD 15/oz range, peaked at USD 2650/oz overnight and while XAU remains firmer on the session it is yet to re-test the above high.


• If it is surpassed, with Fed speak and JOLTS the main scheduled catalysts for today, then the next points of resistance are 2656, 2658 & 2666 before last Monday’s best someway above at 2721.

3M LME Copper: +1.0%

• Lacklustre overnight echoing the indecisive performance seen in China after the latest US export controls.


• Since, base metals have rebounded and are trading in-fitting with the constructive European risk tone with 3M LME Copper probing USD 9.1k to the upside, a marked rebound from Monday’s USD 8.91k trough.


• Updates for the complex have been headlined by China’s MOFCOM banning the export of "dual-use items" relating to gallium, germanium, antimony and super-hard materials to the US from Dec. 3rd. Additionally, implementing tighter end-user and end-use vetting for graphite dual-use items which are exported to the US.


• While of note for metals trade via supply-side dynamics, this announcement may also have ramifications for numerous equity names as gallium and germanium are used in semis and the former also in fibre cables, photovoltaic cells and other points while antimony is used in ammo.

03 Dec 2024 - 10:20- ForexEU Research- Source: Newsquawk