[MARKET ANALYSIS] Crude benchmarks bid on Saudi shutting a key pipeline and the postponement of Iran-Gulf talks on the Strait

Snapshot: Crude benchmarks are stronger this morning on a) the postponement of the Iran-Gulf nations meeting, and b) Saudi Arabia shutting the East-West pipeline. Spot gold is hampered by a stronger USD, whilst base metals have been dented by the risk-tone. To recap the geopolitical environment briefly, Oman postponed the Persian Gulf meeting on Monday, where Iran had planned to formally unveil a temporary shipping lane agreement for the Strait of Hormuz. Axios suggested that Saudi was concerned that the new Strait proposal would effectively establish a new status quo; however, the Iranian FM Spokesperson suggested that the meeting was postponed due to the Yemen-Saudi situation. On the supply front, Saudi shut the East-West pipeline, which reportedly threatens the loss of c. 4% of global supply. Marhelm sources pointed out that repairs could take over a month. Given the above, crude benchmarks gapped higher at the open and traded sideways for most of the APAC session. As the European session got underway, the oil complex caught another bid higher (on reports that the IRGC shot down a US drone, and following Iran FM comments). As it stands, Brent Nov’26 (+3.7%) holds at the top end of a USD 106.11/bbl to 108.57/bbl range; WTI Nov’26 (+3.5%) also holds at the upper end of a USD 101.59/bbl to 103.64/bbl range. Spot gold (-0.8%) has been hampered by a stronger USD (increased rate hike bets) and higher energy prices. As such, the yellow metal currently sits at the bottom end of a USD 4,307.99/oz to USD 4,355.40/oz range. This week, action for gold will be dictated by any geopolitical developments and the Fed mid-week. Elsewhere, base metals are entirely in the red, given the downbeat risk tone. 3M LME Copper currently trades at the lower end of a USD 14,100-14,236/t range.