Eni Cuts Guidance on Weak Oil Prices -- Commodities Roundup

MARKET MOVEMENTS:

--Brent crude oil is up 0.7% at $74.52 a barrel

--European benchmark gas is up 1.4% at 42.76 euros a megawatt-hour

--Gold futures are down 0.3% at $2,740.90 a troy ounce

--LME three-month copper futures are down 0.4% at $9,521.50 a metric ton

TOP STORY:

Eni Cuts Guidance on Weak Oil Prices

Italian energy major Eni lowered its guidance for the year due to a decline in oil prices that also hit net profit in the third quarter.

The integrated oil-and-gas company said Friday that it lowered its target for adjusted operating profit for the year by around 1 billion euros ($1.08 billion) to 14 billion euros. It also cut guidance for cash flow from operations before working capital by 500 million euros to 13.5 billion euros.

Eni had considered an average oil price of $86 a barrel for its previous outlook, but now expects $83 a barrel.

Oil prices ended the quarter to Sept. 30 at $71.70, tumbling from above $87 a barrel earlier in the period.

OTHER STORIES:

Thames Water Proposes $3.9 Billion Funding Deal to Continue Operations

Thames Water proposed a deal to secure up to 3 billion pounds ($3.89 billion) from creditors to extend its liquidity and continue its operations.

The U.K. water company said Friday that the deal would enable the debt-laden company to continue with its planned investment and maintenance of its infrastructure. In August, it proposed to spend 23.7 billion pounds over the next five years.

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VW Pitches America's Heartland on EVs With New Scout Pickup, SUV

Volkswagen is hoping America's obsession with pickup trucks and chunky sport-utility vehicles will help boost sales in the U.S.

At an event Thursday evening, the German auto company's Scout Motors brand unveiled its first vehicles: an electric pickup and SUV, each priced around $60,000. Both vehicles have a retro, boxy style and were designed for towing and off-road use. They are scheduled to go on sale in 2027.

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Archrock Raises Quarterly Dividend for Second Time This Year

Archrock raised its dividend for the second time this year, increasing the payout to 17.5 cents per share from 16.5 cents.

The company last raised its dividend in January, from 15.5 cents.

The new dividend, 70 cents per share on an annual basis, represents a dividend yield of 3.4%, based on the company's closing share price of $20.11 on Thursday.

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Whitehaven Coal 1Q Output Jumps Following Mine Acquisitions

Whitehaven Coal said it produced 62% more coal in its first fiscal quarter, and that sales surged by more than 80%, following the acquisition of two mines in eastern Australia.

The miner on Friday reported saleable coal production of more than 7.1 million metric tons for the three months through September, up from 4.4 million tons a year earlier.

MARKET TALKS:

Palm Oil Falls Amid Profit-Taking -- Market Talk

1016 GMT - Palm oil ended lower, tracking Wall Street's mixed session overnight and the decline in crude prices, Kenanga Futures analysts said in commentary. Profit-taking also contributed to the price decline, said David Ng, a trader at Kuala Lumpur-based proprietary trading company Iceberg X. Ng sees CPO support at MYR4,500 and resistance at MYR4,680. The Bursa Malaysia Derivatives contract January delivery ended MYR70 lower at MYR4,533 a ton. ([e-mail])

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Eni's Earnings Beat Driven by Gas Trading, Lower Tax -- Market Talk

0939 GMT - Eni's 3Q earnings were better than market expectations, boosted by gas trading and lower tax, Citi analysts say in a note. The Italian energy company lifted its buyback guidance by 25% thanks to asset sales and a lower payout ratio compared with rivals, the analysts say. Its share valuation is now 5%-10% higher than European oil peers like TotalEnergies, Shell, and BP, which is unusual compared to past trends and likely limits potential for further gains, they say. Shares are up 0.7% at 14.32 euros. ([e-mail])

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OPEC+ Isn't Expected to Hike Oil Output Until 3Q 2025, BNP Paribas Says -- Market Talk

0828 GMT - OPEC and its allies aren't expected to start raising oil output until 3Q 2025 due to continued market weakness, BNP Paribas's Aldo Spanjer says. "We consider restoring some supply to a weak market would be the worst possible scenario for OPEC+ as it would not only lose revenue but also not gain market share," the strategist says in a note to clients. Spanjer expects OPEC+ to focus its narrative around compensation cuts from Iran, Russia and Kazakhstan, which would create room for the return of some volumes. ([e-mail])

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Oil on Track for Weekly Gains Amid Middle-East Uncertainties -- Market Talk

0812 GMT - Oil prices are headed for weekly gains as markets closely monitor developments in the Middle East. Brent crude and WTI are both down 0.1% in early European trade at $73.93 and $70.11 a barrel, respectively. Despite this, they are up 1.2% and 2.1% on the week. U.S. and Israeli negotiators are set to meet again in the coming days to resume ceasefire talks, but Israel's intensifying strikes on multiple fronts and uncertainties over the scope of the country's response to Iran are leaving the oil market on edge. Still, analysts say the geopolitical risk premium to oil will likely remain limited given the lack of material supply disruptions and broadly bearish sentiment amid fears of sluggish demand in China and a global supply surplus next year.([e-mail])

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Gold Futures Slip as Profit-taking Kicks In -- Market Talk

0808 GMT - Gold futures fall 0.3% to $2,740.40 a troy ounce. The precious metal had peaked at $2,772.60 an ounce on Wednesday, followed by a sharp sell-off. This price action reflects a tug-of-war between profit-taking short-term investors, and persistent demand from investors committed to buying gold on dips, says Pepperstone's Ahmad Assiri. The recent dip is likely to be a temporary price-consolidation phase, and partially reflects rising bond yields, Assiri says in a note. But the pullback in prices has also proven gold's ability to attract fresh investment demand. The upcoming U.S. election continues to loom over markets, stoking fresh uncertainties. Geopolitical tensions are also bubbling, keeping the longer-term outlook for safe-haven assets like gold positive, Assiri says. ([e-mail])

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Copper Prices May Rise Less Than Expected -- Market Talk

0728 GMT - Copper prices are likely to rise less than expected for the remainder of this year, CCB International's Helen Lau says. The average year-to-date copper price has fallen more than CCB anticipated, Lau says. She notes that prices slid 17% from mid-May to mid-August. Recent China stimulus policies will offer relief, but will require time before affecting economic fundamentals, she says. CCB cuts its copper price forecast for 2024 to 2026 by 16%, 14% and 13% respectively. Copper is flat at US$9,509.50 a ton. ([e-mail])

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Congo Copper Output to Boost Africa Production -- Market Talk

0615 GMT - Expansions at copper mines across the Democratic Republic of Congo support higher output in Africa, Oxford Economics Africa says. However, the country's weakening currency risks curbing gains despite improved global prices, it adds. The continent's copper output is expected to rise 8% to 4 million metric tons this year and increase to 4.4 million tons in 2025, accounting for about 20% of the global production. Output from Congo rose 11% in the first eight months of the year, Oxford notes. That was driven by increased production at CMOC's Kisanfu mine and Tenke Fungurume mine as well as Ivanhoe Mines' Kamoa-Kakula complex, it says. Congo and Zambia account for the bulk of Africa's copper output. "We still expect copper prices to trend higher over the short term, supporting the DRC's external position." ([e-mail];@Nicholasbariyo)

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S-Oil Could Post 2H Operating Loss on Weak Demand -- Market Talk

0452 GMT - S-Oil could post an operating loss in 2H due to weak demand for refined-oil and chemical products as well as a fire-hit plant shutdown in July, Nomura analyst Cindy Park writes in a note. The South Korean oil refiner, controlled by Saudi Aramco, could also be pressured by its large capital expenditure to build a new chemical plant that is due to be completed in 2026, Park says. She expects S-Oil to record operating losses of 98 billion won for 3Q and 40 billion won for 4Q. Nomura cuts its target price on the stock by 21% to 59,000 won and keeps a neutral rating. Shares are 1.2% lower at 57,700 won. ([e-mail])

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Palm Oil's Recent Strength May Be Short-Lived -- Market Talk

0258 GMT - The recent strength in palm oil prices may be short-lived but still presents an upside risk to BMI's 2024 forecast of MYR3,850/ton. Prices have surged to multiyear highs due to reduced export supply, strong edible-oil markets and a weaker ringgit, BMI says in a note. For 2025, BMI projects average price palm oil at MYR3,650/ton. Key upside risks to BMI's forecast include Indonesia's higher biodiesel mandates, which could lower exports; potential reductions in Indian import tariffs; and global oil price fluctuations driven by geopolitical tensions. The Bursa Malaysia Derivatives contract for January delivery is up MYR23 at MYR4,626 a ton. ([e-mail])

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Iron Ore Rises Amid Hopes for More China Stimulus, Improved Demand -- Market Talk

0235 GMT - Iron ore gains in Asian trade as markets await China's upcoming legislative meeting for more stimulus measures and amid ongoing improvement in demand. The most-traded iron-ore contract on the Dalian Commodity Exchange is 2.5% higher at CNY767.0 a ton. However, there is a broad oversupply in the iron ore market, with Chinese port stocks remaining 40% higher than this time last year due to elevated arrivals, Goldman Sachs analysts say in a note. Prices could be further weighed by surging shipments from India and Australia, GS adds. ([e-mail])

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(END) Dow Jones Newswires

10-25-24 0813ET