The recent divergence between oil and natural gas prices gathered momentum this week and although we think prices overshot, we remain of the view that the outlook for natural gas prices in 2019 is positive, while we see little upside for oil. The oil market is likely to remain volatile ahead of the next OPEC meeting in early December. For now, all the signs are that OPEC will decide to cut production, which could give the price of oil some respite.
Elsewhere, the prices of commodities, and particularly metals, were buoyed by signs of an apparent renewed willingness on the part of China to negotiate with the US on trade. However, we remain sceptical that there will be a breakthrough in talks when the US and Chinese presidents meet at the G20 meeting at the end of the month. Otherwise, it will be a quiet week on the data front and US markets will be closed on Thursday for Thanksgiving.
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