*Coal*
There was further weakness in coal markets today, with NEWC swaps leading the decline as prices continued to unwind gains from the recent rally. The pullback came amid limited activity in the physical Newcastle and DES ARA markets, with recent weather-related disruptions in Australia seemingly dampening trading interest. Meanwhile, European gas prices saw sharper intraday volatility, with the front-month contract dropping around 5%. This pronounced move added bearish pressure across the broader energy complex, contributing to the softer tone in coal derivatives.
*Brent Crude*
Brent crude futures traded in a narrow range for much of the day, initially holding above $66/bbl in early trading. However, as the session wore on, prices softened, with the July contract last seen around $64.30/bbl. Sentiment remained underpinned by rising geopolitical risks and expectations that OPEC+ will maintain its scheduled supply increases despite recent market volatility. Uncertainty surrounding potential US sanctions on Russia added a modest risk premium. Still, broader gains were limited by persistent concerns over the global economic outlook and weak refining margins in Asia, which continue to weigh on demand forecasts.
*European LNG (Dutch TTF Gas)*
TTF gas futures edged higher early in the session, briefly topping €37/MWh amid speculation that a US court ruling against legacy tariffs might support global energy demand. Although the decision is under appeal, the temporary easing of trade tensions lifted hopes for stronger fuel consumption from key markets such as China and the US. For Europe, this adds to concerns of tighter LNG supply competition just as summer temperatures begin to lift Asian demand. Meanwhile, Norwegian flows are gradually recovering from scheduled maintenance, though outages at Troll persist. European storage levels remain critically low at just under 50%, compared to nearly 70% at the same point last year, keeping supply concerns in focus. By late afternoon, TTF was slightly down at €35.53/MWh, off 0.22% on the day.
*Iron Ore*
Iron ore futures on the Dalian Commodity Exchange rebounded modestly today, with the I2509 contract closing 1.29% higher at CNY707/tonne. Support came after a US court blocked the reinstatement of tariffs on Chinese goods, easing trade war concerns and improving sentiment across the steel complex. However, fundamentals remain mixed. Rising export volumes from Australia and Brazil continue to pressure seaborne supply dynamics, with Chinese port arrivals increasing on a weekly basis. Transaction levels were steady but unremarkable, as restocking activity from steel mills picked up modestly ahead of the weekend, keeping trade activity moderate overall.
*Copper (LME)*
LME copper prices posted slight gains, with the 3-month benchmark contract last quoted at $9,577.50/tonne, up 0.22%. A continued drawdown in exchange inventories, particularly across LME and COMEX warehouses, pointed to tight physical supply. Asian buyers remained active, while some traders continued to take advantage of discounts on Russian-origin material held in European storage. Despite the near-term bullish signals, broader macroeconomic uncertainty and sluggish manufacturing indicators—particularly out of Europe—are keeping a lid on more aggressive upside momentum.
