Commodities Daily - February 20, 2018

Oil supported by upbeat OPEC comments amid little reaction to stronger dollar. BP will today publish its Energy Outlook for 2018 (at 17:30 Moscow time), while BP CEO Bob Dudley and UAE Energy Minister Suhail Al Mazroui are scheduled to speak at London International Petroleum Week. Al Mazroui is the incumbent OPEC president and commented last week that the OPEC+ signatories are aiming to draft a long-term agreement by year end. We think Al Mazroui is likely to provide verbal support to oil prices, and we see it trading in the $65-66/bbl range today. We expect some light to be shed on the shape or form of the OPEC+ exit strategy that is expected to be announced in June.
Gold prices slide after a quiet session yesterday. Today’s data schedule is quiet. Germany’s ZEW investor sentiment survey is due, but it is unlikely to impact markets. Our FX team notes that EUR/USD momentum is likely to be influenced by the developments in Latvia, one of the eurozone’s smaller members. Yesterday, Latvian central bank governor and ECB council member Ilmars Rimsevics was accused of bribery. Today, however, EUR/USD is likely to hold within a 1.235-1.240 range, with gold settling in a $1,335-1,340/oz corridor.