12 November 2025
Commodities traded with a cautious tone on Wednesday as markets balanced shifting supply forecasts against lingering macroeconomic uncertainty. Oil prices slid on signs of a structural surplus emerging next year, gas markets were steady but geopolitically complex, iron ore rallied on firm near-term steel production before facing renewed downside risks, and copper benefited from a stronger policy backdrop in China.
Coal
API2 prices continued to ease from last week’s highs, pressured by softer gas and oil markets. In contrast, Newcastle prompt swaps regained some ground after a competitively priced December physical cargo changed hands, potentially paving the way for a firmer index through the remainder of the month. The December Newcastle physical traded at $105.75, down from $106.50 last week, while the DES ARA December cargo in Europe settled at $95.75, compared with $98.75 at the end of October.
Brent Crude
Oil prices dropped more than 2% on Wednesday, pressured by OPEC’s latest outlook suggesting that global supply will match demand in 2026, a reversal from previous expectations of a deficit. The report attributed the adjustment to continued production increases from OPEC+ members, who have collectively raised output by around 2 million barrels per day (bpd) since April. The projection reinforced market concerns that the balance could tilt towards surplus, especially if demand growth remains modest. Adding to the debate, the International Energy Agency (IEA) in its World Energy Outlook 2025 forecast that oil and gas demand could continue expanding until 2050, driven by industrialisation and transport demand in developing economies. This long-term projection tempered the near-term bearishness but did little to offset immediate supply pressure. Market participants noted that Brent’s decline was also accelerated by profit-taking after recent gains and by expectations that inventories will continue to build into early 2026.
Spot Brent at 17h32 GMT – $62.77/bll, down -3.68%
European LNG
Dutch TTF gas futures opened higher on Wednesday amid forecasts for colder weather across northwest Europe, before easing later in the session. According to LSEG, local distribution zone demand—including residential heating—is expected to rise by 190 GWh/day next week as temperatures dip below seasonal norms. On the supply side, European LNG imports remain robust, though a growing share originates from Russia despite sanctions. Data from the Institute for Energy Economics and Financial Analysis (IEEFA) showed that EU imports of Russian LNG rose 7% year-on-year in the first half of 2025, even as total Russian gas imports—pipeline and LNG combined—fell roughly 70% since 2022. The EU has reaffirmed plans to phase out all Russian energy imports by 2027, though the transition appears uneven. Meanwhile, China is increasing purchases of sanctioned Russian LNG, reportedly assembling a “shadow fleet” of tankers to bypass Western restrictions. This marks a strategic deepening of Sino-Russian energy cooperation, as Beijing seeks diversified and discounted energy sources.
Spot Dutch TTF at 17h33 GMT – €30.95/MWh, Down -0.5%
Iron Ore
Iron ore prices firmed on Wednesday, with the Dalian Commodity Exchange (DCE) January contract closing 1.38% higher at 774 yuan/mt. The number of furnaces resuming operations exceeded those under maintenance, sustaining short-term demand for iron ore. However, supply headwinds are looming. The Simandou iron ore project in Guinea officially commenced production this week, with its first shipment destined for China. The addition of new high-grade supply is expected to weigh on prices in the months ahead. Analysts forecast that an increase in blast furnace maintenance later in November could further reduce hot metal output, shifting the near-term balance toward surplus. In other news, the Simandou project in Guinea—one of the world’s largest and highest-grade iron ore deposits—has officially begun operations after nearly three decades of development, a milestone that marks the start of its long-anticipated path toward full-scale production.
Spot SGX 62% Fe at 16h30 GMT – $103.15/mt, Down -0.48%
Copper (LME)
Copper extended gains on Tuesday as sentiment improved following China’s latest pro-growth announcements. Beijing unveiled measures to boost private investment in infrastructure, while the People’s Bank of China reaffirmed its commitment to maintaining “appropriately loose” monetary conditions. The rally also drew strength from broader risk appetite as U.S. lawmakers moved closer to resolving the government shutdown. A compromise bill passed by the Senate lifted confidence across financial markets, benefitting industrial metals. Tight mine supply continues to underpin copper’s fundamental outlook. Analysts highlight that production disruptions in Chile and Zambia, combined with sustained Chinese demand for grid expansion and electrification, could support prices near current levels into year-end.
LME 3-month copper at 17h28 GMT – $10,909.50/mt, Up 0.82%
The midweek session reflected diverging commodity dynamics—energy markets turning defensive on supply realignment, while metals drew modest strength from policy optimism and resilient industrial activity. With OPEC’s monthly report and U.S. inflation data due later this week, traders remain cautious, watching for cues that could set the tone heading into year-end.
