[MARKET ANALYSIS] Crude benchmarks climb over Iran's threats to strike US bases as copper falls over continued AI concerns

Crude benchmarks have climbed throughout the Asia-Pac session and continue as Europe steps in. Iran’s IRGC Navy said four vessels transferring oil cargoes were struck in the Persian Gulf, while three other vessels hit sea mines yesterday west of the Strait of Hormuz, warning that US efforts to encourage passage could result in strikes on US bases. With repeated airing of these comments, it has continued to support the energy complex. WTI briefly topped USD 100/bbl, but currently holds at the upper end of its USD 97.72-100.09/bbl range, while Brent trades in a USD 109.81-112.55/bbl range. All being said, the crude complex remains contained within Tuesday’s broad range. Elsewhere, the NYT reported that the US and Israeli militaries have developed plans for renewed strikes on Iran after the US midterm elections, targeting energy infrastructure, nuclear facilities and missile and drone arsenals, while Israeli press cited US official comments that there has apparently been a change in the American position in favour of a pre-emptive strike on Iran. Spot gold has come under pressure in the European morning, as it resides at the lower end of its USD 4067-4146/oz range. Zooming out to the range formed over the past month, the yellow metal sits at the bottom of that range (USD 4066-4228/oz). The precious metal has not been favoured by usual risk-off flows or a weaker dollar, but instead found headwinds from escalating Middle East hostilities, which has raised inflation risks ahead of the Fed decision next week. 3M LME Copper slid overnight and currently holds at the bottom end of its USD 14.09k-14.37k/t range. The red metal is tracking the losses in the equity space, over continued worries of the AI trade. Copper has benefited recently due to its use in data centres and power infrastructure.