MNI COMMODITY WEEKLY: China Wields Power Over Putin Charm Offensive this Week

(MNI London)

• China Wields Power Over Putin Charm Offensive this Week: Putin is in China this week to further cement positive relations post the invasion of Ukraine which has left Russia annexed from the West. Russia has held power over western energy supplies - but in the East it is the other way round as Putin looks to facilitate deals with China in the years ahead, leaving Xi Jinping holding the cards.

• Oil Markets: Market focus is on the risk of an escalation in the Israel conflict driving crude to the highest since 2 Oct with support from better-than-expected China data to offset hopes for easing Venezuela sanctions. Overall refining margins remain healthy with strong middle distillates offsetting weak gasoline cracks.

• Gas Markets: European natural gas prices remain volatile and traded between €45.10-56.10/MWh in the past week. While a milder weather outlook, the halt to industrial action in Australia and near-historic high storage levels have offered downside, supply risks amid the Balticconnector pipeline outage and the conflict in Israel, potentially affecting Egyptian LNG exports, offered upside. US natgas has eased back in the past week due to higher production and lower consumption.

Full piece here:

MNI Commodity Weekly - China Wields Power Over Putin Charm Offensive this Week.pdf