| Oil embargo, Biden and Powell to meet, and MLIV Pulse. After weeks of negotiation, European Union leaders agreed late Monday to pursue a partial ban on Russian oil as part of a sixth package of sanctions. The proposal, which would come into effect six months from adoption, rules out buying crude oil and petroleum products from Russia delivered to member states by sea (which account for about two-thirds of the EU's oil imports from Russia), but includes a temporary exemption for crude via pipelines. Oil headed for the longest run of monthly gains in more than a decade following the news. Technical details are still under discussion and the final deal must be formally adopted by all 27 EU member states. Ambassadors meet again on Wednesday. US President Joe Biden will hold a rare meeting with Federal Reserve Chair Jerome Powell on Tuesday amid the highest inflation in decades, which has angered Americans and hurt his standing with voters ahead of mid-term elections. They will discuss the state of the American and global economy, according to a White House statement. Treasury Secretary Janet Yellen is also scheduled to join the meeting. Meanwhile, Fed Governor Christopher Waller said he wants to keep raising interest rates in half-percentage-point steps until inflation is easing back toward the US central bank's goal. Waller is a voting member of the rate-setting Federal Open Market Committee this year.  | The incredible liquidity experiment of the pandemic era is over. With the Fed finally beginning its balance sheet reductions, is the froth already out of asset valuations or is there much more pain to come? Quantitative tightening officially starts Wednesday and is the theme of this week's MLIV Pulse survey. Click here to share your views. Last week's survey found that a majority of 540 participants projected Beijing will stand firm on the severe lockdown polices, with the covid-zero strategy set to stay in place for the rest of the year. But more than half of respondents, and over two thirds of portfolio managers, said they expected to increase their exposure to the nation over the next 12 months. US futures fell on Tuesday as of 5:45 a.m. New York time, cooling a recent rally as optimism from China's reopening faded amid inflation woes. In Europe, stocks were mixed. Travel, construction and financial services were the worst performing sectors. Stoxx 600 fell 0.5%, while the UK's FTSE 100 outperformed regional peers, adding 0.3%. In fixed income, Treasury yields jumped across the curve, joining a selloff in German bunds and European bonds. The US 10-year yield rose 8 basis points to 2.8206%. The dollar and oil gained, while Bitcoin resumed trading above $31,000. We have a busy session ahead for economic data starting with March's housing numbers from the FHFA and S&P Corelogic at 9 a.m. May's Chicago PMI is due at 9:45 am., the Conference Board Consumer Confidence release at 10 a.m. and the Dallas Fed Manufacturing Activity Index at 10:30 a.m. Canada will release their 1Q and March GDP data at 8:30 a.m. Salesforce Inc. and HP Inc. are among the companies scheduled to report earnings. Here's what caught our eye over the long weekend. A ton of copper is going for just under $10,000 right now. But according to Goldman Sachs, in the coming years it will surge to $15,000. What's more, the bank can't rule out the possibility of it going to $50,000 or even $100,000 over the next decade. On the latest episode of Odd Lots, Nicholas Snowdon describes the simple supply/demand dynamics that could turn copper into the tightest commodity market we've ever seen. Basically, total demand for copper is expected to boom over the next decade -- driven in large part by EVs and other green spending -- while at the same time, there's virtually nothing taking place right now in terms of opening up new mines. What's more, according to Snowdon, a new copper mine takes about 3 years to start producing these days, unlike during the last super-cycle of the early 2000s, when it could be done in less than a year. So the mismatch is clear enough. But there's another element that could make it really pop. Unlike with other commodities, demand destruction is really difficult. In other words, copper is crucial for electric vehicles; however, it's not such a large part of the end sticker price that higher costs will significantly change overall affordability or demand for EVs. Here's Snowdon: "For the copper price to drive demand destruction in cars, in electronics, you're gonna have to see a massive outsized move in the copper price to achieve the necessary increase in the cost of the total good to drive that demand destruction. It's very different to energy and agricultural commodities."
So the demand curve can stay basically fixed, even as prices continue to surge. Later he points to Lithium -- another crucial commodity where demand destruction is difficult -- as an example of the type of price action we could theoretically see. The whole conversation is fascinating and a must-listen for understanding the next decade. Check it out here or on Apple or Spotify. Follow Bloomberg's Joe Weisenthal on Twitter @TheStalwart | 
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