20th October 2025
Commodity markets were mixed today, with energy prices broadly softer and coal leading the retreat after recent volatility. European gas held steady, oil extended its decline, and physical coal markets eased following last week’s rally.
Coal
Coal market volatility persisted today, though prices pulled back more sharply, led by declines in API2. European gas remained largely steady, finishing the session near unchanged, while oil extended its downward trend with front-month Brent crude falling another 1%. Physical DES ARA markets softened after last week’s gains, and the physical Newcastle market was also better offered.
Brent Crude
Oil prices fell nearly 2% as growing concerns over oversupply and renewed U.S.–China trade tensions weighed on sentiment. Traders have shifted focus from fears of shortage to expectations of surplus, with both economic and political risks clouding the outlook. The World Trade Organization warned last week that an extended U.S.–China decoupling could trim global output by as much as 7% over time. The two nations—world’s top oil consumers—have reignited their trade dispute, imposing additional port fees on shipping routes that could disrupt global freight and energy flows. Meanwhile, uncertainty surrounding Russian and Indian oil trade persists, after President Trump reiterated that Washington would maintain “massive” tariffs on India unless it ceases Russian crude purchases.
Spot Brent at 16h30 BST – $60.63/bll down 1.01%
European LNG
European gas futures were steady in a narrow range as healthy inventories and stable supply offset geopolitical tensions. EU storage remains strong at 82.9% capacity, with Italy at 93.9%, France at 92.7%, and Germany at 75.7%, alleviating immediate winter supply concerns. LNG inflows and Norwegian pipeline deliveries continue to balance lower Russian flows, while weaker Chinese demand from Russia’s Arctic LNG 2 project has freed additional cargoes for Europe. However, Russia’s strikes on Ukraine’s gas infrastructure—cutting national output by almost 60% this month—keep risk elevated. EU energy ministers also backed a proposal to ban Russian gas imports, signalling further decoupling from Moscow’s supply network. Longer term, LNG capacity growth of 60% by 2030, led by the U.S., could create persistent oversupply and cap prices in both Europe and Asia.
Spot Dutch TTF Gas at 16h30 BST – €31.60/MWh, down 0.68%
Iron Ore
Iron ore futures extended losses, with the most-traded I2601 contract closing at CNY 767, down 0.58%. Trading activity was muted as steel mills remained cautious and transaction volumes low. Shrinking mill margins and expectations of stricter environmental controls have led to maintenance shutdowns, further softening demand. At the same time, shipments and port arrivals increased notably this week, leaving supply conditions comfortable. With weaker fundamentals and limited buying interest, iron ore prices are expected to remain rangebound in the near term.
Spot SGX 62% iron ore at 15h40 BST – $104.95/mt, up 0.10%
Copper (LME)
Copper prices rebounded after stronger-than-expected Chinese industrial output data lifted sentiment. September industrial production grew 6.5% year-on-year, beating forecasts of 5.0%, though GDP growth slowed to its weakest in a year. The data eased demand concerns ahead of the Chinese Communist Party’s Fourth Plenum, where policymakers are set to outline the 2026–2030 economic plan. Meanwhile, ongoing supply disruptions at key mines, including Grasberg in Indonesia, have prompted analysts to trim production forecasts. Markets also remain focused on the potential outcome of renewed U.S.–China trade talks later this week.
LME 3-month copper at 16h30 BST – $10,701.50/mt, up 1.00%
The session closed with a cautious tone across commodities. Coal prices corrected lower, oil continued to slide, and gas remained rangebound, leaving markets consolidating recent moves amid subdued demand signals and broader economic uncertainty.
