The Commodities Feed: Copper drops from three-month high after weak China manufacturing data
Copper dropped from a three-month high this morning after weak manufacturing data from China added to concerns over the economic recovery in the world’s biggest metal consumer.
Energy: European economic data helps sentiment
ICE Brent maintained the positive trend yesterday and settled at a fresh three-month high of US$85.6/bbl on supply-side risks combined with a positive set of economic data from Europe. Eurozone inflation dropped further to 5.3% in July compared to 5.5% in June and the economics team at ING believes that inflation should be materially lower towards the end of the year. Meanwhile, EU GDP growth returned to positive territory last quarter at 0.3% quarter-on-quarter compared to negative 0.1% in the preceding quarter.
On the supply side, the Alberta Energy Regulator reported that crude oil production in Alberta, a major crude oil production region in Canada, dropped by 21% year-on-year to 2.7MMbbls/d in June 2023. The June production numbers do not include production from Suncor, one of the largest producers in the country. Meanwhile, the suspense over Saudi’s plan for September production continues, and the market is waiting for any hint or confirmation during the OPEC+ Joint Ministerial Monitoring committee meeting that is scheduled for this Friday.
On the products side, recent market reports suggest that oil processing rates in Russia could move higher in August, as major refineries complete their ongoing spring maintenance and as refineries maximise the operating rates to take advantage of the final month of full government subsidies. Russia has announced it will cut subsidies in half for domestic supplies of diesel and gasoline from September through 2026.
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