Palm Oil Ends Lower Amid Weak Soybean, Crude Oil Prices — Market Talk

Europe will likely need to ramp up imports of liquefied natural gas to meet its storage filling targets for the year as inventories deplete fast, according to MUFG. Inventories have been withdrawn at an average rate of around 350 million cubic meters a day this winter, compared to a rate of 220 mcm/d in the same period last year, analysts at the group say. Data from Gas Infrastructure Europe shows EU storage is currently 64% full, more than 15% lower on year. "European gas inventories are set to end the winter season 34% full," the analysts say. "Europe will need to import around 30% more LNG on an annualized basis before the start of the next winter season in October 2025 to meet the EU's 90% storage fill target." The benchmark Dutch TTF price currently trades 1.7% lower at 46.22 euros a megawatt hour. (giulia.petroni@wsj.com)

Steel rebar futures rose to over CNY 3,290 per tonne, extending the rebound from the three-month low of CNY 3,129 touched on January 8th amid optimism that demand for major manufacturers and constructors will gain some traction this year.

China exported 9.7 million tons of steel in December, a 26% surge from the previous year to cap off a record-setting year for steel exports, indicating that major Chinese mills continued to sell large volumes of metal to for foreign consumers despite the growing global protectionism rhetoric.

In turn, leading appetite was supported by a surge in Chinese iron ore imports, indicating that mills expect high turnover.

Signals pointing to a rebound in demand also included the sharp rebound in the NBS Construction PMI, which rose to 53.2 in December from the record low of 49.7 in November.

Meanwhile, investors continued to gauge the impact of incoming economic support from Beijing this year, led by looser monetary policy and more deficit spending.

European natural gas prices fell to €46 per megawatt-hour, reflecting steady supply even as colder weather drives up demand.

Gas storage is lower than it was last year (65% full compared to 77% in 2024), but there’s no immediate risk of shortages.

Forecasts show colder-than-normal temperatures in northwest Europe from January 17-22, along with weak wind power generation until January 24, which will increase the need for natural gas.

At the same time, the EU is considering banning imports of Russian liquefied natural gas (LNG) as part of potential new sanctions.

While pipeline gas imports from Russia have decreased over the years, Europe imported record amounts of Russian LNG in 2024.

Brent crude oil futures steadied just below $82 per barrel on Thursday, after a 2.6% jump in the previous session, still hovering near six-month highs, amid growing concerns about global supply disruptions and a sustained drop in US crude inventories.

US sanctions targeting Russia’s energy industry have shaken markets, with the International Energy Agency warning of severe impacts on Russian supply chains.

Buyers of Russian oil are shifting sources, while shipments off China’s coast are stalled as traders try to navigate the restrictions.

India’s refiners are rushing to settle Russian deals.

The US sanctioned 160 tankers tied to Russian oil, curbing 1.6 million barrels per day, while inventories in the US dropped to their lowest since April 2022.

UK Gas decreased to a 9-week low of 91.48 GBp/thm.

Over the past 4 weeks, Natural Gas UK GBP gained 11.43%, and in the last 12 months, it increased 52.58%.

The potential impact of the new U.S. sanctions on Iranian and Russian crude oil exports could be bullish for prices, says Phillip Nova. Markets are bracing for stricter sanctions on oil, which could disrupt global supplies, analyst Priyanka Sachdeva writes in a note. However, gains could be limited as Israel and Hamas agreed to a deal to pause fighting in the Gaza Strip, she says. The softening of geopolitical stress strips the need for extra "war premium" in prices, she adds. Front-month WTI crude oil futures are up 0.1% at $80.11/bbl; front-month Brent crude oil futures are up 0.1% at $82.10/bbl.(amanda.lee@wsj.com)