EU Reaches Deal to Ban Russian Gas Imports by 2027 -- Commodities Roundup

MARKET MOVEMENTS:

-- Brent crude oil is up 1.2% to $63.19 a barrel.

-- European benchmark gas is flat at 28.07 euros a megawatt-hour.

-- Gold futures are up 0.3% to $4,234.10 a troy ounce.

-- LME three-month copper futures are up 1.9% to $11,352 a metric ton.

TOP STORY:

EU Reaches Deal to Ban Russian Gas Imports by 2027

The European Union reached a deal to permanently halt imports of Russian gas, a significant milestone in the bloc's efforts to sever energy ties with Moscow following the invasion of Ukraine.

Under the agreement, all imports of Russian gas will be banned from the fall of 2027, with earlier phase-out deadlines for liquefied natural gas and short-term supply contracts.

"This historic decision will end the EU's dependence on an unreliable supplier, which has repeatedly destabilised European energy markets, put at risk security of supply with energy blackmail and harmed the European economy," the European Commission said on Wednesday.

OTHER STORIES:

Ukraine Goes After Moscow's Shadow Fleet in International Waters

The sun was setting over the Black Sea on Friday as a naval drone sped toward an oil tanker headed for a Russian port. The Sea Baby drone, developed by Ukrainian security services, slammed into the vessel's hull moments later, triggering a fireball that lit up the pink-hued sky.

The grainy footage-which Ukrainian intelligence says shows a strike on a Russia-linked oil tanker-offers a glimpse into Kyiv's widening campaign against Russia's energy architecture. Ukraine is now targeting the Kremlin's shadow fleet, which relies on an opaque web of ships to skirt sanctions on its oil exports and reap funds for its war in Ukraine.

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Vulcan Energy Resources to Proceed With German Lithium Project

Vulcan Energy Resources will proceed with its lithium and renewable energy project in Germany after securing a finance package to fund the initial phase of development.

The company said Wednesday that it has secured a 2.2 billion-euro ($2.56 billion) package from government agencies and banks for the construction of phase 1 of the Lionheart project in the Upper Rhine Valley.

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Perseus Mining Makes $1.3 Billion Offer to Buy Predictive Discovery

Gold producer Perseus Mining said it has made a binding offer to acquire Predictive Discovery that values the explorer at more than 2.0 billion Australian dollars, equal to roughly $1.3 billion.

Perseus, which already holds nearly 18% of Predictive Discovery's stock, said Wednesday it has proposed buying each share it doesn't currently own for 0.1360 new Perseus shares.

MARKET TALKS:

LME Copper Hits Record High on Supply Concerns -- Market Talk

1136 GMT - Copper prices climb to record highs, driven by concerns over global supply and a weaker U.S. dollar. Futures on the London Metal Exchange rise 1.8% to $11,348 a metric ton, after hitting an intraday peak of $11,434.50 a ton. The U.S. dollar index, instead, is down 0.4% to 98.99. Copper has recently been boosted by prospects of a December interest-rate cut by the Fed, as lower borrowing costs typically stimulate economic activity and demand. Meanwhile, traders have been ramping up shipments to the U.S. amid fears of potential future tariffs by the Trump administration, tightening supply in other regions. According to ANZ Research, several commodity traders have approached Chilean producers to lock in U.S. annual supply deals for 2026, with some paying more than $500 a ton over benchmark LME prices. ([e-mail])

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European Gas Prices Pressured by Ample Supplies -- Market Talk

1107 GMT - European natural-gas prices hit their lowest since April 2024 as ample supply eases concerns over potential shortages during the heating season. The benchmark Dutch TTF contract falls 0.5% to 27.92 euros a megawatt hour and is down 12% on the month. Milder-than-usual temperatures for this time of the year and rising imports of U.S. LNG are weighing on prices, despite EU gas storage levels falling fairly quickly. According to industry group Gas Infrastructure Europe, inventories are now below 75% full. Still, "U.S. LNG exports, which predominantly find their way to Europe, hit an all-time high in November for the second consecutive month," ANZ analysts say. "The continued rise should help Europe meet demand over the next few months." ([e-mail])

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Palm Oil Falls Amid Cautious Sentiment -- Market Talk

1014 GMT - Palm oil ended lower amid cautious sentiment. Market participants' sentiment has been weighed by expectations of rising palm oil stocks, says David Ng, a trader at Kuala Lumpur-based Iceberg X. There is a build-up in palm oil stocks due to seasonally weak demand, he adds. Ng sees support for CPO futures at 4,000 ringgit a ton and resistance at 4,180 ringgit a ton. The Bursa Malaysia Derivatives contract for February delivery closed 3 ringgit lower at 4,156 ringgit a ton. ([e-mail])

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Softer Energy Prices, Lower Dollar Hedging Costs Lift Euro -- Market Talk

0856 GMT - Lower energy prices are a key driver of the euro's gains, ING analyst Chris Turner says in a note. "Softer energy prices are sending the eurozone's terms of trade to the highest levels of the year and supporting the eurozone's external accounts," he says. Another major driver is that hedging costs have fallen for eurozone residents wanting to take protection against losses on U.S. assets stemming from the risk of a weaker dollar, he says. News that Kevin Hassett could be the next pick for the Federal Reserve Chair also provides some support to the euro versus the dollar as he's expected to deliver interest-rate cuts. The euro rises 0.2% to $1.1640. ([e-mail])

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Gold Rises as Traders Await U.S. Data -- Market Talk

0847 GMT - Gold prices rise as investors await key U.S. economic data this week for more cues on the Federal Reserve's interest-rate trajectory. New York futures gain 0.4% to $4,237.20 a troy ounce following a decline in the previous trading session driven by easing safe-haven demand and profit-taking. Market participants are closely watching upcoming data, including ADP employment figures, the ISM services index, and the PCE price index. According to the FedWatch tool, traders are pricing in an 87% chance of a December interest-rate cut. Meanwhile, physical demand remains robust. "ETFs increased their gold holdings for the fifth consecutive day, adding 194,788 ounces," ANZ analysts say. "This marks the biggest one-day increase since Oct. 21." Silver futures are flat at $58.74 an ounce, while platinum is up 0.7% to $1,661.30 an ounce. ([e-mail])

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Oil Rises With Focus on Russia-Ukraine Negotiations

0832 GMT - Oil prices rise in choppy trade as investors continue to monitor developments in Russia-Ukraine peace talks. Brent crude is up 0.5% to $62.74 a barrel, while WTI rises 0.6% to $58.97 a barrel after slipping earlier in the session. "Ukraine peace talks continued, reportedly without major breakthroughs," Goldman Sachs analysts say. However, "oil markets and prediction markets do not appear to price a large probability of a near-term peace agreement and removal of the sanctions on Russia oil," analysts at Goldman Sachs say. A peace agreement could lead to the removal of U.S. sanctions on Russian oil, freeing up more barrels into the market at a time when concerns over a potential surplus are growing. ([e-mail])

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London's Miners Get Boost From High Gold Prices -- Market Talk

0828 GMT - London's miners are among the biggest risers on the FTSE 100 index in opening trade. They are being supported by strong gold prices and expectations of a cut to U.S. interest rates. Gold futures rise 0.35% at $4.235.60 a troy ounce in early trading. Higher interest rates weigh on non-yielding assets like gold. Fresnillo and Endeavour Mining are both up 1.6%. Copper miner Antofagasta is up 1.9%. Rio Tinto's and BHP's London-listed shares both rise 1.3%. Glencore rises 1.1% ahead of its capital markets day later in the day. ([e-mail])

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Gold's Rally Might Face Challenges Next Year -- Market Talk

0349 GMT - Gold's rally could be challenged if sentiment improves next year and asset allocations return to risky assets, says Alexandra Symeonidi at William Blair. While futures positioning is above long-term averages, it is well below the peaks of this year, likely signaling less optimism in gold markets after an impressive rally since the beginning of the year, she says. Investor allocations to gold could rise in a scenario of sticky inflation in a rate-cutting cycle, the senior corporate credit and sustainability analyst says in a note. Symeonidi also reckons that "gold's demand from central banks is more structural as fiscal deficits have been increasing in the U.S. and emerging market central bank allocations to gold as a percentage of foreign reserves is low." Spot gold is at $4,223.79/oz, according to LSEG. ([e-mail])

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Palm Oil Rises on Rising Demand, Supply Concerns -- Market Talk

0252 GMT - Palm oil rises in early Asian trade. Prices are likely to be supported by robust demand ahead of the Lunar New Year and Ramadan festive season in early 2026, AmInvestment Bank writes in a note. Meanwhile, heavy rainfall and flooding in many parts of Asia, including Malaysia, are likely to curtail supply, says AmInvestment Bank. The Bursa Malaysia Derivatives contract for February delivery is 8 ringgit higher at 4,167 ringgit a ton. ([e-mail])

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Iron Ore Edge Higher, But Fundamentals Remain Weak -- Market Talk

0221 GMT - Iron ore futures edge higher in early Asian trade. Most analysts remain neutral as the fundamentals remain weak. Supply and demand are relatively sluggish, Everbright Futures analysts write in a note, adding that the inventories have pressured iron ore prices. There's a lack of near-term catalyst to support prices for longer, they say. The most actively traded January iron ore contract on the Dalian Commodity Exchange is up 0.1% at CNY801.5 a ton. ([e-mail]; @ivy_jiahuihuang)

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