Commodity Snapshot
Natural gas futures rose after two consecutive weeks of decline, falling nearly 8% last week due to milder weather forecasts and lower heating demand. However, global gas prices increased due to competition for cleaner fossil fuels and demand in Asia.
Asian buyers are actively taking advantage of the price drop, while storms off the coast of northern Australia are likely to disrupt supply, causing LNG export facilities to partially or fully close. Disruptions to US supply are also emerging.
European natural gas futures rose by 8% to approach €29/MWh, reaching their highest level since early February due to supply concerns. Repairs at the Freeport LNG terminal in Texas have reduced flows, with work expected to continue through April. JPM Commodities Research remains bullish on the 2025 Henry Hub price due to potential midstream issues preventing significant volumes from reaching the Gulf.
Oil prices rose due to stronger-than-expected economic data from China and continued drone attacks on Russian energy plants, raising supply risks. The strikes added a $2-$3 per barrel risk premium to crude last week, and have idled around 7% of Russian refining capacity in the first quarter. The attacks process and export crude varieties to markets like China and India.
Investors are closely monitoring the outcome of the U.S. Federal Reserve’s two-day meeting, which ends on Wednesday. Policymakers in Japan, UK, Switzerland, Norway, Australia, Indonesia, Taiwan, Turkey, Brazil, and Mexico also meet this week. Copper prices were mixed on Monday, with London contract easing and Shanghai prices hitting a record high due to tight supply.
China’s retail sales and industrial production increased by 5.5% and 7.0% YoY in January-February 2024, surpassing the market consensus.
Meanwhile, the Biden administration is offering a $2.26 billion loan to Lithium Americas for Nevada’s largest lithium deposit.
Stocks to watch: American Vanguard (AVD) +22%, Lithium Americas (LAC) +8%, Sigma Lithium (SGML) -9%, Lifezone Metals (LZM) -7%, Sylvamo (SLVM) -7%, Euronav NV (EURN) -8%.
Recent Commodity Price Movements
Energy
Crude oil (CL1:COM) +0.97% to $81.83.
Natural Gas (NG1:COM) +6.15% to $1.76.
Metals
Palladium (XPDUSD:CUR) -1.16% to $1,065.15.
Platinum (XPTUSD:CUR) -1.81% to $916.39.
Gold (XAUUSD:CUR) +0.01% to $2,155.72.
Copper (HG1:COM) -0.14% to $4.11.
Agriculture
Corn (C_1:COM) +0.42% to $438.61.
Wheat (W_1:COM) +1.35% to $535.66.
Cotton (CT1:COM) +2.00% to $95.82.
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Spot gold was trading -0.3% lower at $2,176.89 an ounce as markets awaited the release of U.S. CPI data, which could influence the Federal Reserve’s policy path. A hotter-than-expected reading could delay the central bank’s easing cycle. Low interest rates help bullion by reducing the opportunity cost of holding the zero-yielding asset. A mixed tone prevailed across commodity sectors, with China’s economic growth concerns affecting bulks and supply concerns supporting industrial metals. Commodity Snapshot Commodity Snapshot Commodity Snapshot
Natural gas and crude oil prices were trading in the green, while oil prices fell earlier due to persistent demand concerns in China. NS Trading president Hiroyuki Kikukawa said that concerns over weak demand in China outweighed the extension of supply cuts by OPEC+. Mixed US jobs data prompted some traders to adjust positions. However, losses will be capped by increased geopolitical risk, with the possibility of a ceasefire in the Hamas-Israel war and conflict expansion in Russia and its neighbors. Europe remains the most impacted region, as oil product shipments from Asia have fallen since January. OPEC+’s voluntary production cut agreement could tighten the market as demand recovers from its seasonal lull.
Natural gas and crude oil prices were trading in the green, while oil prices fell earlier due to persistent demand concerns in China. NS Trading president Hiroyuki Kikukawa said that concerns over weak demand in China outweighed the extension of supply cuts by OPEC+. Mixed US jobs data prompted some traders to adjust positions. However, losses will be capped by increased geopolitical risk, with the possibility of a ceasefire in the Hamas-Israel war and conflict expansion in Russia and its neighbors. Europe remains the most impacted region, as oil product shipments from Asia have fallen since January. OPEC+’s voluntary production cut agreement could tighten the market as demand recovers from its seasonal lull.
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