3rd July 2025
*Coal*
After a strong week-long rally, API2 coal swaps paused on Thursday, consolidating slightly amid a lack of support from gas markets. In the Pacific, the pullback was more pronounced, with Newcastle swaps seeing weaker bids and offers drifting lower through the afternoon. A potential disruption at the Port of Newcastle due to adverse weather was largely averted, with operations resuming during the day and full capacity expected by Friday.
*Brent Crude*
Oil futures slipped on Thursday as rising U.S. inventories and increased OPEC+ output signalled oversupply, despite peak summer demand. September Brent was last down 0.84% at $68.51/bbl (16:03 BST). The market has traded mostly sideways after surrendering a $10 risk premium following the Israel-Iran ceasefire, which eased Middle East tensions and shifted focus to weaker fundamentals. OPEC+ plans to add 411,000 bpd in August, bringing 2025’s total production increase to 1.78 million bpd—more than 1.5% of global demand. Sluggish global growth and uncertainty over U.S. tariff policy continue to weigh on sentiment.
*European LNG (Dutch TTF Gas)*
TTF gas futures rebounded to €34/MWh after touching an eight-week low, last up 1.27% at €33.73/MWh. Stable supply from Norway and consistent LNG flows underpinned the market, even as cooler weather and increased wind output are expected to reduce gas demand in power generation. An Iran-Israel ceasefire has eased concerns over supply disruptions via the Strait of Hormuz. Meanwhile, weak Chinese LNG demand—pressured by slower economic growth and U.S. tariffs—has boosted European supply. On the policy front, the EU is preparing a 2040 climate target to cut net emissions by 90% from 1990 levels.
*Iron Ore*
Iron ore futures climbed to a six-week high near CNY 725/tonne, supported by China’s efforts to cut excess industrial capacity and curb low-price competition in steel markets. Higher steel prices have drawn retail traders back into iron ore futures, anticipating further upside. Supply concerns also contributed to gains, with recent data showing lower export volumes from key producers Rio Tinto, BHP, Fortescue, and Vale. A private survey showing Chinese factory activity returned to growth in June added further support. On SGX, August TSI 62% iron ore was up 0.31% at $96.85/mt (16:08 BST).
*Copper (LME)*
Copper prices pulled back after briefly surpassing $10,000/mt, with traders booking profits ahead of key U.S. jobs data. LME 3-month copper was last down 0.60% at $9,952/mt (16:07 BST), though still up 2.6% on the week. The market remains supported by expectations of potential U.S. tariffs and tightening supply, especially as Chinese smelters face concentrate shortages. Copper flows have increased to the U.S. in anticipation of trade measures, boosting Comex premiums to as high as $1,400 over LME prices and draining non-U.S. warehouse stocks. Upcoming U.S. labour data may influence Fed policy and the dollar, with implications for metals pricing.
