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After a period of extreme volatility, we expect the price of US natural gas to edge higher in the remainder of this year. Together, a rise in LNG exports and a pick-up in US consumption this winter will keep stocks low by past standards and underpin a …
11th July 2022
There was no clear direction in commodity prices this week, even within the same types of commodities. The takeaway is that commodity prices were dancing to their own tunes . Take energy, for example. Natural gas and coal prices rose on fears that Russia …
8th July 2022
US petroleum product demand to be seasonably soft US commercial crude stocks rose owing to a fall in net exports and lower inputs to refineries. For now, implied product demand remains in line with its seasonal norm, but we expect demand to be soft for …
7th July 2022
Overview – Non-energy commodities prices generally fell in June on the back of concerns about the outlook for demand amid global monetary tightening and slower economic growth. Energy prices may also fall a little from here, but constrained supply will …
6th July 2022
Prices struggled to find direction this week as concerns about demand deepened at a time of still constrained supply of many commodities . The price of Brent crude fell sharply on Thursday in response to US real spending data for May, which were weaker …
1st July 2022
We think that the recovery in China’s PMIs in June was driven by the lifting of virus-related restrictions rather than an improvement in underlying economic conditions. Accordingly, we think that softer growth in China’s activity will continue to weigh on …
We expect that the prices of agricultural commodities will fall back gradually over this year and next, but remain historically high. However, the volatility of prices in recent months and the uncertainty of the current environment mean there are major …
30th June 2022
Refinery constraints to put a floor under commercial crude oil stocks Commercial crude stocks fell last week as refineries raised production of petroleum products. However, refineries will probably struggle to raise output much further, with many of them …
29th June 2022
The G7 proposal to impose a cap on the price of Russian oil and gas would introduce new supply-side risks by potentially disrupting Russian energy supplies. This could push global energy prices up further, but for now we still see Brent crude prices …
28th June 2022
We think the prices of agricultural commodities will fall back in the coming months, but most will remain historically high owing to tight supply, concerns about future supply and high energy prices. Consumer food price inflation has been soaring in …
24th June 2022
Most commodity prices fell this week as demand concerns picked up due to ongoing monetary policy tightening by major central banks . Speaking to the US Senate Banking Committee on Wednesday, Federal Reserve Chair Jerome Powell underlined his “strong …
Whilst OPEC+ has been failing to meet its production quotas in recent months, it will technically finish unwinding its pandemic-related supply cuts come September. We think OPEC+ will then move to a more liberal approach and allow the few members with …
23rd June 2022
Steel production to remain lacklustre in 2022 Global steel production continued to pick up in May, led by higher output in India and China, which more than offset the ongoing decline in Europe’s production. The rise in input costs, efforts to curb carbon …
22nd June 2022
A threatened strike at Chile’s copper giant, Codelco, could knock as much as 0.3%-pts off quarterly GDP growth for every week that workers are on strike and worsen the country’s balance of payments strains. What’s more, it may not even be enough to give a …
21st June 2022
Supply is picking up, just as prices fall Global aluminium production has increased steadily since the start of the year in large part owing to a rebound in China’s output. At the same time, demand is relatively subdued, which suggests that aluminium …
20th June 2022
European natural gas prices surged this week on renewed supply concerns, as Russia once again cut gas supplies to Europe and the US Freeport LNG export facility closed for six months . The huge price move emphasises how volatile natural gas prices can be …
17th June 2022
Russia’s decision to once again cut supplies to Europe makes the region’s gas supply look increasingly precarious. The move will slow regional stock builds and keep prices historically high . Russia’s monopoly gas exporter, Gazprom, announced on Wednesday …
16th June 2022
Robust Chinese refined metal output, alongside subdued domestic demand, has combined with constrained refined output elsewhere to provide greater export opportunities for China. But there are limits on the extent to which Chinese metal can fill the …
High prices keeping a lid on demand Commercial crude stocks rose again this week, following another unusually large release from the strategic reserve. Meanwhile, implied product demand fell back as petroleum product prices remain very high. We’re …
15th June 2022
The closure of the Freeport LNG facility in the US, for up to six months, adds to concerns about Europe’s ability to fill its gas storage tanks ahead of winter. We always suspected that supply concerns would re-emerge this year and, as a result, we …
OPEC still seems optimistic on Russia’s output this year The gap between OPEC-10’s quota and output widened further in May, which adds weight to our view that the group will fail to fully unwind its production cuts by year-end. What’s more, whilst OPEC …
14th June 2022
The supply risks associated with the war in Ukraine have not gone away, but there has been more market attention in recent weeks on the outlook for commodities demand. In the very near term, the lockdowns in China weighed on both energy and, to a lesser …
10th June 2022
Softer demand for steel in Europe has dragged prices lower recently, despite production in the region being constrained by high production costs. We expect prices to fall a little further to €900 per tonne by end-year from around €950 currently . The war …
9th June 2022
Commodity import volumes revived a little in May, perhaps as virus-related restrictions started to ease. Although demand should pick up in tandem with activity as major cities re-open, we think that high prices and slower export growth will mean that …
Demand holding up, for now Commercial crude oil stocks rose this week owing to an unusually large release from the strategic reserve and a slump in crude exports. Interestingly, implied product demand ticked up, after being relatively subdued for a few …
8th June 2022
Overview – Energy and agricultural prices continued to rise in May as concerns about supply more than offset signs that demand, at least for energy, could soften. We expect prices to remain historically high but to start to ease back later in the year as …
7th June 2022
Despite a rise in May, China’s PMIs still point to weak Chinese demand, which will continue to weigh on industrial metals prices. However, the war in Ukraine will remain the bigger driver of energy prices. China’s official and Caixin manufacturing PMIs …
1st June 2022
Global refinery capacity is stretched with less of Russia’s capacity at work Slack should return if Russia re-routes some of its petroleum product exports But unplanned refinery outages will now remain a bigger risk to crude oil demand In this Energy …
31st May 2022
The EU’s sixth round of sanctions on Russia marks yet another defining moment in the West’s detachment from Russia’s energy trade. The sanctions were widely telegraphed in advance, though, so for now we still forecast that crude oil prices will remain …
Disruption to supply rather than strong demand has pushed prices higher Ample stocks and bearish financial market backdrop create potential for sharp price fall But the risk premia will be structurally higher in agricultural prices going forward The last …
A persistent theme in energy markets is uncertainty about the outlook for the EU’s imports of energy from Russia . It does appear that some sort of embargo of oil imports will be announced, maybe as early as next week. However, this is not new news and is …
27th May 2022
We expect China’s steel output to fall a little this year in line with government objectives. But we think that subdued demand, notably from the steel-intensive construction sector, will lead to lower prices for Chinese steel later in the year . The …
Commercial stocks to continue to lean on strategic reserves for support Commercial crude oil stocks fell again last week, but at a slower pace. Once again, lower net imports and higher refinery inputs led to the drawdown. Although both drivers became more …
25th May 2022
Steel production still depressed by high energy costs Global steel production fell in y/y terms in April, as all major producers bar India recorded declines. High energy costs and soft demand for steel are both likely to persist for much of the remainder …
24th May 2022
The recent tightening of export restrictions has been limiting the supply of staple agricultural commodities available to global markets and pushing up prices. In light of the ban on wheat exports from India, we’ve raised our forecast for the price of …
23rd May 2022
The prices of many industrial metals (IM) picked up this week on news of an easing of COVID-19 restrictions in China . However, we think weak demand and improved supply in China will send IM prices lower in the coming months, even if high energy prices …
20th May 2022
China could ride to the rescue After a weak start to the year, it looks increasingly as though a rebound in China’s output will more than offset lower production in Russia and Europe so that global production will rise a touch this year. That said, supply …
High product prices to suppress demand this summer Commercial crude oil stocks fell last week due to exports rising faster than imports and refineries stepping up operations. But high petroleum product prices should hold back demand in the coming months, …
18th May 2022
After a post-pandemic rebound in 2021, we expect growth in global demand for natural rubber (NR) to slow this year in tandem with a downturn in industrial activity, notably in the NR-intensive auto sector. That said, the market will remain in a deficit …
Most commodity prices fell this week amid a general sell-off in risky assets and a stronger US dollar . That said, we think the days of higher energy prices leading to an all-encompassing rally in commodity prices could be over. Natural gas prices rose on …
13th May 2022
Exchange stocks of base metals have fallen so far this year as high power costs have choked the supply of refined metals. Yet, we expect stocks to build as a weaker economic outlook for key metal consuming regions will weigh on demand, and easing energy …
OPEC production still falling short of target OPEC lowered its forecast for Russia’s oil production this year, but still expects it to rise. By contrast, we think Russia’s output will fall and see rising pressure on OPEC to step up output in response . …
We expect US fuel prices to remain historically high this year due to supply constraints. As a result, we suspect that oil consumption in the US will remain seasonably low for much of the rest of the year. US implied product demand has fallen from a …
12th May 2022
Unless prices fall, US demand is likely to remain soft Commercial crude stocks will be boosted in the coming weeks by the ongoing release of strategic reserves, regardless of what is happening with domestic oil demand. That said, there are now clear signs …
11th May 2022
News of force majeure on one of the pipelines in Ukraine bringing Russian natural gas to Europe just adds to our conviction that Europe is going to struggle to meet its gas needs over the next year. The heightened competition for gas imports suggests that …
Energy commodity imports held up relatively well in April given the widespread COVID-19 restrictions. But the trade data throw up some question marks about demand for industrial metals given the downturn in export volumes and somewhat lower metals imports …
9th May 2022
Energy prices continue to be pummelled by upward pressure related to fears of supply shortages and downward pressure from signs of slower economic growth, tighter monetary policy and a stronger US dollar . This week was no exception, although supply fears …
6th May 2022
We expect weaker electronics demand and a recovery in supply from South-East Asia to weigh on the tin price, dragging it lower by end-year to $34,000 per tonne from around $41,000 currently . The price of tin has been boosted by the pandemic in two very …
We expect Indonesia’s latest ban on palm oil exports to be short-lived, but constrained supply and the high prices of other edible oils, coupled with elevated oil prices, will support the price of palm oil. We’ve revised up our palm oil price forecast to …
5th May 2022
High petroleum product prices to constrain US oil demand Commercial crude oil stocks rose last week on higher imports, lower exports and less crude oil being used by refineries. Implied product demand, meanwhile, was little changed and towards the lower …
4th May 2022
