[MARKET ANALYSIS] Crude futures relatively contained amid positive rhetoric by US President Trump; PBoC adds gold for a 24th consecutive month

Crude futures have bounced off their earlier lows and now resides around the unchanged mark. The initial weakness at the open was driven by positive rhetoric by US President Trump, telling CNN that it is highly unlikely the US will need to resume military action against Iran, provided progress is made in negotiations over Tehran's nuclear programme and reopening the Strait of Hormuz. However, downbeat comments by US Secretary of State Rubio and reports of continued strikes in the Strait of Hormuz limited the downside in energy benchmarks. Rubio said talks with Iran are not productive as the Iranian demands are simply unacceptable and said that sometimes a diplomatic solution is not possible. To add, US CENTCOM announced Task Force Iron Gate, as it continues to target Iran’s economy. WTI and Brent are off their earlier lows, and holds in their respective USD 89.80-90.95/bbl and USD 96.57-98.39/bbl ranges. Precious metals trend higher, with spot gold residing at the upper end of its USD 4054-4134/oz range, despite higher yields. One underlying factor supporting the yellow metal is China, with data showing that the PBoC added 830K ounces of gold to its reserves in October, extending its buying streak to 24 consecutive months. 3M LME Copper is benefiting from the constructive risk tone across markets, with the red metal residing at the top end of its USD 13.8k-13.89k/t range.