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Energy – Funds go short TTF
 

The oil market is stuck between the potential for progress in Russia-Ukraine peace talks and what that would mean for oil supply amid a broader risk-on trade as expectations grow for a December interest rate cut by the US Federal Reserve. A peace deal would likely remove much of the supply risk facing the market, potentially leading to the lifting of US sanctions on Russia. For today, though, market action is likely to be relatively muted due to the US Thanksgiving holiday.

OPEC+ is set to meet this weekend. We believe the group will leave production unchanged. The fundamental outlook remains fairly similar to where it was at the group’s last meeting. Admittedly, though, there’s more uncertainty over Russian oil supply. Earlier this month, the group paused any further supply increases over the first quarter of 2026.

The Energy Information Administration’s (EIA) weekly inventory report was relatively bearish. According to the release, US crude oil inventories increased by 2.77m barrels over the last week, a stark contrast to the 1.9m barrels decline the American Petroleum Institute (API) reported the previous day. The increase was driven by a 560k b/d week-on-week decline in crude exports, while imports were up 486k b/d. Inventory builds were also reported in refined products, with gasoline and distillate fuel oil stocks increasing by 2.51m barrels and 1.15m barrels, respectively. An increase in refinery run rates supported the build in product stocks, with run rates rising 2.3 percentage points WoW to 92.3%. An end to refinery maintenance, along with broader strength in refinery margins, supported higher refinery operating rates.

European gas storage continues to trend lower, falling below 78% full. The strong draws come amid colder-than-usual weather, though forecasts indicate the weather will turn milder in early December. Despite lower-than-average storage levels for this time of year, investment funds remain increasingly bearish on the European gas market. The latest positioning data shows that speculators shifted from a net long of 15.6TWh to a net short of 11.4TWh. This is the first time funds have been short the Title Transfer Facility (TTF) since March 2024. The move was once again driven by fresh shorts entering the market, which pushed the gross short to yet another record high. This large short position leaves a fair amount of positioning risk, if any supply or demand surprises emerge through the winter.

Metals - China’s silver stockpiles hit decade low
 

The global silver market faces renewed supply concerns amid a drop in Chinese inventories to their lowest level in 10 years. Official data show silver on-warrant stocks at Shanghai Futures Exchange warehouses fell by 9,361 kilograms to 531,211 kilograms as of yesterday -- the lowest since 2015.

The sharp decline reflects large shipments to London, aimed at easing a squeeze that recently pushed prices to record highs. This drawdown follows a surge in Chinese silver exports, which jumped to over 660 tonnes in October, marking an all-time high.

Meanwhile, the Shanghai market moved into backwardation, with near-term silver prices trading above later-dated contracts, signalling short-term physical tightness in China.

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