Commodities Daily - February 21, 2019

> Oil surges amid stock market gains, comments from Saudi oil minister and upbeat API data; EIA inventory update eyed. Today, investors will eye preliminary PMIs for February, which will provide some insight into the outlook for oil demand growth. We assume that Brent will remain within the $67-68/bbl range today and think an upbeat EIA inventory report will likely push the benchmark toward the higher end of this corridor. The next major resistance level is 50% Fibonacci retracement (from the October price correction) at $67.9/bbl.> Gold corrects after Fed minutes. The minutes suggested that the Fed would not raise rates twice this year, as the last dot plot showed. Our FX analysts expect the euro to weaken against the dollar today following the ECB minutes. Thus, we think gold is likely to continue sliding toward $1,330/oz.> Copper tests $6,400/tonne having gained 3.2% this week. In addition to the China-US trade talks, the market is being driven higher by supply risks, including a shutdown at Vedanta in India, a transport strike in Peru and fears that bad weather could affect Codelco mining output in Chile. This morning, base metals are trading slightly lower across the board amid dollar strength.