[MARKET ANALYSIS] Crude softens as efforts for a US-Iran deal continue

Crude markets are on a softer footing amid ongoing mediation efforts to broker some sort of US-Iran deal following two flare-ups earlier this week. In terms of the major updates, US President Trump said negotiations with Iran were progressing and suggested a deal could come within days, although talks could also continue for several more weeks. Meanwhile, US Secretary of State Rubio said the US is awaiting Iran’s final sign-off on negotiations surrounding Tehran’s nuclear programme. On the other side, Iranian officials outlined a four-stage framework for a potential agreement with the US. The four-stage proposal for a deal with the US includes: 1) Ending the war, 2) tangible measures re. the Strait, 3) sanctions and nuclear issues, 4) the establishment of a supervisory committee. More recently, Al Arabiya reported that the agreement on the release of frozen Iranian funds is in its final stages, albeit the search continues for a mechanism for frozen funds. The sources added that Trump informed the mediators of his refusal to release funds to Iran before signing the agreement. Elsewhere, Israel and Lebanon agreed to implement a US-brokered ceasefire framework and continue negotiations, although since the ceasefire, Hezbollah and IDF continued to exchange fire in the south of Lebanon.
WTI Jul and Brent Aug futures are subdued in USD 94.38-95.91/bbl and USD 96.06-97.44/bbl ranges, respectively, at the time of writing, with fleeting downside seen on the aforementioned Al Arabiya sources. Dutch TTF ekes mild gains (+0.2%) but trades choppy on either side of EUR 49/MWh. “Positioning data for TTF continues to show that investment funds have been somewhat unfazed by ongoing LNG supply disruptions in the Middle East amid optimism over a resumption of LNG flows through the Strait of Hormuz”, analysts at ING write.
Spot gold and silver are firmer after yesterday's losses, with the yellow metal finding support this morning at its 200 DMA (USD 4,423/oz) before rebounding to trade in a current USD 4,423-4,484/oz range. Spot silver trades in a USD 72.45-73.91/oz range, still some way off yesterday’s peak at USD 75.33/oz.
Base metals are mostly lower amid the broader cautious risk tone. 3M LME copper ekes mild gains but remains under USD 14,000/t in a USD 13,701.13- 13,849.00/t at the time of writing.