Five Key Charts to Watch in Global Commodity Markets This Week

(Bloomberg) -- There will be plenty of fresh data for the oil market to digest as the Organization of Petroleum Exporting Countries and the International Energy Agency both release their monthly market reports later this week, a few days after the US Energy Information Administration releases its Short-Term Energy Outlook. Meanwhile, gold traders will be watching as the precious metal takes aim at its August 2020 high of $2,075.47 an ounce. Here are five notable charts to keep an eye on in global commodities.

Gold

Spot gold has been on a tear, surging above $2,000 an ounce as weaker-than-estimated economic data revived concerns that the US is heading toward a recession amid the Federal Reserve’s aggressive tightening stance. While bullion, the safe haven of choice in uncertain times, is less than $70 shy of its record high set in August 2020, it’s also approaching two technical extremes: the upper band of its trading envelope (a measure built around moving price averages) and the 70 level on its 14-day relative strength index. Breaches of both can often signal to some traders that a reversal is in store.

Oil

Oil prices are benefiting from renewed concerns over a tightening market, especially after OPEC+’s surprise decision to slash more than 1 million barrels of daily output starting in May. Reports this week from OPEC, the IEA and EIA will shed further light on the supply picture, with further inventory drawdowns likely supporting price gains. Combined with a backdrop of global economic uncertainty and questions over the path of Fed interest-rate hikes, near-term volatility can also be expected.

Mining

The clock is ticking for Glencore Plc to convince investors of Teck Resources Ltd. to reject company plans to split its coal and metals operations at an April 26 vote, keeping alive the Swiss miner’s $23 billion takeover attempt. Glencore would still need to win over Teck’s management and shareholders to land the second-largest mining acquisition in Canada, where some of the world’s biggest deals have unfolded in the past two decades. Many top-tier Canadian metals producers have disappeared over the years thanks to domestic and foreign takeovers, leaving the country with few remaining mining champions on the global stage. 

Emissions

The Biden administration is expected this week to propose the toughest-ever curbs on pollution from new cars and light trucks, while stopping short of mandating zero-emission electric vehicles or barring the sale of conventional gas-powered models. The standards, to be released Wednesday by the US Environmental Protection Agency, are likely to govern tailpipe emissions from vehicle model years 2027-2032, according to people briefed on elements of the plan. While EV adoption is forecast to expand, BloombergNEF data show, growth could be limited in the near term by coming requirements governing what consumers are eligible to claim from Inflation Reduction Act tax credits of as much as $7,500 per vehicle.

LNG

The world’s biggest buyers of liquefied natural gas in Northeast Asia and Europe have shown less interest in buying spot cargoes of the fuel lately, as a milder winter has left surplus stockpiles available. That’s leaving emerging nations with an array of super-cooled gas shipments to meet electricity generation demand. The combined imports of India, Thailand and Latin America surged to 3.76 million tons last month, the highest level since August. The increased flows may bring relief to citizens, and stimulate economic growth. These nations held back on purchases when LNG prices were elevated last year, in some cases resulting in blackouts and power rationing.

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