Yesterday in the afternoon, commodities markets saw a broad sell-off. The front-month contract on Brent thus fell below 92 USD per barrel (USD/bbl) as fears ahead of the EU meeting overshadowed ongoing strike of Norwegian oil workers.
The situation in the Brent market, however, remained comfortable as the short-end of forward curve showed a positive slope. Meanwhile, the US administration granted China and Singapore waivers releasing the countries from sanctions imposed on their imports of oil from Iran. Recall that the US also gave such a waiver to India and other major importers of Iranian oil earlier this year as those countries had cut the imports of Iranian oil significantly.
Overnight, euro zone leaders agreed to use the EFSF/ESM instruments in a flexible manner in order to stabilize markets of member states. Such outcome was hardly expected and thus boosts commodities prices across the board today in early trading. At the time of writing, Brent is seen just shy of 93 USD/bbl level.
LME copper surges to 9 days high after an unexpected result of overnight talks of EU leaders. The price of the metal thus breached 7500 USD per ton (USD/t) level whereas three month aluminium is seen at 1870 USD/t.