Fire at One of World's Largest Battery Plants Prompts Evacuations in California -- Commodities Roundup

MARKET MOVEMENTS:

--Brent crude oil is down 0.3% at $81.01 a barrel

--European benchmark gas is up 1.4% at 46.89 euros a megawatt-hour

--Gold futures are down 0.1% at $2,749.60 a troy ounce

--LME three-month copper futures are down 0.5% at $9,194.50 a metric ton

TOP STORY:

Fire at One of World's Largest Battery Plants Prompts Evacuations in California

A fire at a major battery-storage plant in Northern California prompted the evacuation of nearby residents.

Hundreds of residents in the area around the Moss Landing Power Plant in Monterey County were evacuated late Thursday after the fire broke out, and parts of Highway 1 were closed. No immediate casualties were reported.

The battery-storage plant owned by Texas-based Vistra is one of the world's largest, containing thousands of lithium-ion batteries that are charged using solar power. The energy is placed on the grid when the sun goes down.

OTHER STORIES:

Schlumberger Launches $2.3B Stock Buyback, Raises Dividend by 3.6%

Schlumberger is repurchasing $2.3 billion worth of stock and raising its quarterly dividend by 3.6%.

The oilfield services company said Friday that it has entered into accelerated share-repurchase transactions to buy back $2.3 billion of its shares. About 80% of those shares were repurchased earlier this week, and the rest will be bought back by the end of May, the company said.

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Schlumberger 4Q Revenue Climbs with Gains Overseas, North America

Schlumberger recorded flat earnings but higher revenue in the fourth quarter with gains across most of the regions in which it operates.

The oilfield services company posted a profit of $1.1 billion, or 77 cents a share, about flat with $1.11 billion, or 77 cents a share, in the same period a year ago.

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Valero Energy Boosts Dividend 5.6%

Valero Energy raised its dividend to $1.13 a share from $1.07.

The new dividend, equal to $4.52 a year, represents an annual yield of about 3.2% based on Thursday's closing price of $139.37.

The San Antonio-based oil refiner said the higher dividend will be paid March 3 to shareholders of record as of Jan. 30.

MARKET TALKS:

Crude Oil Lower as Trump Inauguration Eyed -- Market Talk

0938 ET - Crude oil is down 0.6% to $77.41 a barrel in early trading, with most commodity markets under pressure ahead of the Trump inauguration Monday. While oil has been digesting the effect of new sanctions on Russia's oil sector, focus is turning to how the incoming Trump Administration will handle it. "The clear message from Trump's Treasury Secretary nominee Scott Bessent this week--that he is prepared to aggressively use sanctions on Russia's oil sector to bring Russia to the negotiating table--suggests that U.S. policy is unlikely to be reversed soon," says Kieran Tompkins of Capital Economics in a note. Brent crude is down 0.7% to $80.76 a barrel. ([e-mail])

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Natural Gas Backs Off From Multi-Year Highs -- Market Talk

0921 ET - Natural gas futures are down 6.4% early, backing off from a 2-year high hit yesterday and pushing natural gas futures back below the $4 per mmBtu mark. Since the start of the year, natural gas futures have jumped roughly 17%, due to colder-than-usual temperatures seen in many U.S. regions, leading to a historical-sized withdrawal of natural gas from storage. In the coming weeks, natural gas prices are expected to relax, although analysts are allowing for the possibility of more abnormal cold to hit and spark more demand. "Surprises remain possible during the back half of winter," says EBW AnalyticsGroup in a note. "At present, however, returning medium-term weakening is the most-likely outcome for natural gas prices." ([e-mail])

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EU LNG Imports From Russia Rise in Early 2025 -- Market Talk

1334 GMT - European Union imports of liquefied natural gas from Russia have increased on year in the first two weeks of 2025, data from Kpler shows. The EU's 27 member states imported around 838,000 metric tons of LNG from Jan. 1 until Jan. 15, compared with around 760,000 tons in the same period last year--showing how Europe is still clinging to Russian energy. European gas prices have come down significantly since breaking above 50 euros a megawatt hour earlier in January, but still find support in fast depleting inventories and supply concerns after a transit deal between Russia and Ukraine expired. EU storage levels are currently 63% full and continue their sharp declining trend, with analysts saying Europe will need to further ramp up imports of LNG in order to meet its storage targets for the year. ([e-mail])

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Gold Futures Slip; Recent Gains on Weaker Dollar Might Not Persist -- Market Talk

1255 GMT - Gold futures slip, but remain on-track for monthly gains. Futures are down 0.35% at $2,741.40 a troy ounce. Factors behind gold's gains have shifted away from safe-haven demand as Israel and Hamas agree to a ceasefire, and towards interest rate cut expectations, Commerzbank analysts say. The market is pricing in slightly more U.S. Federal Reserve rate cuts following recent inflation data, halting a surge in the U.S. dollar and prompting a fall in bond yields, Commerzbank says in a note. That said, the prior appreciation of the greenback and rise in yields didn't weigh particularly heavily on gold prices. Therefore, gold's gains are asymmetric and unlikely to last long. Commerzbank analysts question whether gold will be able to maintain its high levels, which would require further rate cut expectations and dollar weakening. ([e-mail])

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Metal Prices Mixed; Copper On Track for Weekly Gains on China Optimism -- Market Talk

1253 GMT - Metal prices are mixed, with LME three-month copper broadly flat on $9,243.50 a metric ton and LME three-month aluminum up 1.4% at $2,669.50 a metric ton. Copper is on track to end the week up 1.9% as Chinese economic data support positive sentiments, SP Angel analysts say in a note. The country's GDP data, retail sales and industrial production data have been positive, they say. Meanwhile, various demand indicators--including the Yangshan import premium--are showing strengthening copper fundamentals, SP Angel says. This presents the potential for a sustained rally over the Lunar New Year holiday as buyers restock before the break, analysts write. At the same time, the metal is also being supported by concerns over tariff implications in the U.S. from the incoming Trump administration, SP Angel adds. ([e-mail])

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Shipping Stocks Slide Ahead of Israel-Hamas Ceasefire -- Market Talk

1052 GMT - The countdown to a return of shipping to the Red Sea could soon begin, with the Israel-Hamas ceasefire agreement due to take effect from Sunday, Jefferies analyst Omar Nokta says. Houthi rebels began attacking commercial vessels in the Red Sea in response to Israel's Gaza offensive, forcing ships to avoid the area and boosting the price container operators can charge customers. A ceasefire paves the way for an eventual return of ships to the Red Sea, but it remains to be seen under what parameters safe passage will commence, Nokta says. "It is fair to say based on Houthi commentary, that a prolonged ceasefire in Gaza (or peace) must come first." Maersk shares fall 4% while Hapag-Lloyd shares are down 1.6%. ([e-mail])

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A Glencore, Rio Tinto Merger Wouldn't Be 'Happily Ever After' -- Market Talk

1046 GMT - A merger between Glencore and Rio Tinto wouldn't be a marriage made in heaven, investment analyst at AJ Bell Dan Coatsworth writes. The two miners would repel each other--Rio Tinto is an environmentally responsible miner while Glencore's pursuit of profit at all costs has earned it the title of 'the bad boy of mining,' Coatsworth says. Both have a keen interest in copper and exposure to iron ore but that is where the similarities end, he writes. Rio Tinto's London shares are up 1.15% at 49.88 pounds, while Glencore's are up 2.65% at 3079.86 pence. ([e-mail])

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Palm Oil Edges Higher Amid Soybean Oil Price Rebound -- Market Talk

1017 GMT - Palm oil edges higher, reversing earlier losses, tracking a rebound in soybean oil prices during Asian hours, said David Ng, a trader at Kuala Lumpur-based Iceberg X. Expectations of a weaker production pace in the coming weeks also boosted positive sentiment, Ng said. He sees support for CPO futures at 4,100 ringgit and resistance at 4,400 ringgit. The Bursa Malaysia Derivatives contract for April delivery rose 0.2% to 4,193 ringgit. ([e-mail])

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Europe's Gas Price Edges Higher With LNG Flows in Focus -- Market Talk

0956 GMT - European natural-gas prices slightly rise in early trade, with the benchmark Dutch TTF contract up 0.2% at 46.36 euros a megawatt-hour. Prices have retreated since reaching their peak earlier in January despite dwindling inventories and the loss of some Russian volumes following the expiration of a transit deal with Ukraine. The price decline is partly attributed to milder weather forecasts and less supply uncertainties as liquefied natural gas flows to Europe, according to DNB Markets analysts. "We are expecting LNG imports to continue to be high going forward, as it is very much needed for Europe to get through the heating season and rebuild inventories into next year," they say in a note. However, Europe's rapidly depleting gas reserves suggest LNG demand will have to increase further this summer, DNB adds. ([e-mail])

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Gold Futures Fall But Set to End Week Higher -- Market Talk

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01-17-25 1031ET