Copper dips as soaring oil prices weigh on economic outlook
XLB•Other metals mostly firmer
Elsewhere, aluminium CMAL3 fell 0.3% to $3,183 a ton, zinc CMZN3 rose 0.6% to $3,614, nickel CMNI3 gained 1% to $17,405, notching a one-month high, while tin CMSN3 added 0.6% to $54,020 and lead CMPB3 edged up by 0.2% to $1,899.50.
Demand signals and U.S. tariff expectations
"It's pretty clear for us that there's no appetite to invest in the downside on copper," Pierre-Alix Favillier, head of base metal options at Sucden Financial, said on a webinar.
"If you look at the investment appetite and the AI story behind, it's only going higher."
In top metals consumer China, the Yangshan copper premium SMM-CUYP-CN — a gauge of demand for imports — was assessed at $115 a ton on Wednesday, the highest daily assessment since November 2022.
Prices have also been supported by strong copper shipments into the United States ahead of a potential tariff on refined copper imports. Traders are awaiting details of the proposed tariff.
Oil strength and tight stocks support the market
Oil prices LCOc1 rose for a fifth day, jumping as much as 5% to $98.75 a barrel after Yemen's Iran-aligned Houthis said they attacked two oil tankers as part of a blockade on Saudi Arabia.
Higher energy prices are weighing on the outlook for the global economy, for which copper is considered a bellwether, and increasing the likelihood of increases to interest rates.
Thin inventories were supporting copper prices, however, with available LME stocks MCUSTX-TOTAL of 107,850 tons the lowest since January. The cash LME copper contract was trading at a $4.70 premium over the three-month forward CMCU0-3 on Wednesday, indicating tight near-term supply.
