Prices to rebound in line with the economic recovery - Capital Economics
Energy

Prices to rebound in line with the economic recovery

Energy Outlook
Written by Caroline Bain

Energy demand and prices have continued to recover from their virus-induced lows, but they remain depressed. However, we expect the revival in energy demand to pick up pace in 2021 as developed economies phase out virus-containment measures and economic activity rebounds, albeit gradually. That said, prices will remain low by pre-virus standards. Turning to the longer term, we suspect that the structural changes accelerated by COVID-19 have brought peak oil demand forward to around 2030.

  • Overview – Energy demand and prices have continued to recover from their virus-induced lows, but they remain depressed. However, we expect the revival in energy demand to pick up pace in 2021 as developed economies phase out virus-containment measures and economic activity rebounds, albeit gradually. That said, prices will remain low by pre-virus standards. Turning to the longer term, we suspect that the structural changes accelerated by COVID-19 have brought peak oil demand forward to around 2030.
  • Short-term Forecast Summary – Quarterly projections to Q1 2022.
  • Economic and Financial Backdrop – Divergence to widen as second waves hit.
  • Oil – Prices to grind higher in 2021.
  • Natural Gas – Ample supply to act as a lid on prices.
  • Coal – A question of how fast, not whether, prices decline from here.
  • Long-term Oil Outlook – COVID-19 to hasten peak oil demand.
  • Long-term Forecast Summary – Annual projections.

Overview

Prices to rebound in line with the economic recovery

  • We expect the prices of most energy commodities to rise a little in 2021 in tandem with the gradual recovery in the global economy. In particular, oil prices should benefit from a revival in economic activity in the developed world.
  • Energy commodity prices have underperformed relative to other commodities (see Chart 1) due to the nature of the current global economic recovery, which is being led by a stimulus-fuelled China. After all, China’s share of global oil consumption is much smaller than its share of global metals use. (See Chart 2.)
  • That said, oil prices have partially rebounded from their April troughs, supported by a wider recovery in riskier assets, including equities. (See Chart 3.) A weakening in the US dollar has also provided further price support. (See Chart 4.) We think that the backdrop for risky assets will remain positive next year, which will give a lift energy commodity prices.
  • While oil demand has revived from its lows in the first half of the year, it remains well below its pre-virus level. Indeed, oil consumption was hit particularly hard by measures to contain COVID-19, such as travel bans and working from home. More recently, rising COVID-19 infections have led to a partial reimposition of containment measures in Europe, which will keep oil demand depressed. We suspect that it will take some time for business travel or commuting to fully recover – if they ever do.
  • Rather, we think it is only because of a sharp drop in oil supply that the oil price has recovered at all. Large OPEC production cuts and an involuntary drop in US output mean that the market is probably now in a small deficit. (See Chart 5.) That said, elevated stocks should prevent any pick-up in prices this year. However, we do expect the price of Brent to rise to $55 per barrel by end-2021 and $60 by end-2022 as economic growth in the US and EU revives and stocks start to be drawn down.
  • Of course, there are key risks to our forecast. For one, we are assuming that virus containment measures are lifted over the course of the coming year. And, perhaps optimistically, we are presuming that OPEC+ compliance with output cuts is maintained. Therefore, the risks to our oil price forecasts probably lie to the downside.
  • Elsewhere, natural gas demand and prices should continue to climb next year in tandem with the global economic recovery. Average prices on the three major regional benchmarks should be higher in 2021 than this year, but a well-supplied global market will cap any gains.
  • Meanwhile, we expect coal prices in both Europe and the Pacific to fall back after the current seasonal upturn in demand peters out. After all, Europe’s use of coal as part of the power generation mix is already falling rapidly. (See Chart 6.) What’s more, a stricter potential 2030 EU target on carbon dioxide emissions (see Chart 7) could prove a further catalyst in speeding up the transition away from coal.
  • And in Asia, demand growth in the key market of China has slowed in recent years, which has been reflected in CO2 emissions. (See Chart 8.) China’s announcement to achieve carbon neutrality before 2060 and have CO2 emissions peak before 2030 means that coal demand growth there will start to contract before long. Indeed, the structural economic slowdown that we expect by the end of the decade in China will likely weigh on coal demand, and in turn, CO2 emissions.

Overview Charts

Chart 1: S&P GSCI Commodity Prices
(1st Jan. 2020 = 100)

Chart 2: China Share of Global Consumption (%, 2019)

Chart 3: Brent Oil Price & S&P 500 (2020)

Chart 4: Brent Oil Price & US Dollar Index (2020)

Chart 5: Oil Market Fundamentals (Mn. BpD)

Chart 6: Europe Electricity Generation from Coal (TWh)

Chart 7: Europe CO2 Emissions
(Mn. Tonnes per Year)

Chart 8: China CO2 Emissions & Coal Consumption Growth (% y/y)

Sources: Refinitiv, WBMS, IEA, OPEC, BP, Capital Economics


Short-Term Forecast Summary

Table 1: Short-Term Forecasts – End-Period

Actual

Forecasts

2020

Latest*

2020

2021

2022

Q2

Q3

28th Oct.

Q4

Q1

Q2

Q3

Q4

Q1

Commodity Indices

S&P GSCI Commodity Index

325

350

359

370

380

395

410

420

425

S&P GSCI Energy Index

130

135

138

145

150

160

170

180

180

Bloomberg Commodity Index

310

350

371

360

365

370

375

380

380

 

Energy

Crude Oil (Brent) (US$ per barrel)

41

41

39

45

47

50

53

55

56

Crude Oil (WTI) (US$ per barrel)

39

40

37

42

44

47

50

52

53

US Natural Gas (US$ per mBtu)

1.75

2.53

3.01

2.50

2.75

2.60

2.80

3.00

3.00

Spot Asian LNG (US$ per mBtu)

2.20

4.90

6.90

5.50

5.50

6.00

6.50

7.00

7.50

European Natural Gas (€ per MWh)

5.75

11.63

14.74

13.75

13.00

10.50

12.00

14.50

12.00

Coal (Rotterdam, US$ per tonne)

50

57

57

55

52

50

47

45

45

Coal (Newcastle, US$ per tonne)

52

59

58

60

60

57

56

55

54

Sources: Refinitiv, Capital Economics

Table 2: Short-Term Forecasts – Quarterly Average

Actual

Forecasts

2020

Latest*

2020

2021

2022

Q2

Q3

28th Oct.

Q4

Q1

Q2

Q3

Q4

Q1

Commodity Indices

S&P GSCI Commodity Index

289

338

359

359

374

387

402

415

422

S&P GSCI Energy Index

105

135

138

140

150

155

165

175

180

Bloomberg Commodity Index

290

330

371

355

365

370

375

380

380

 

Energy

Crude Oil (Brent) (US$ per barrel)

33

41

39

43

46

49

52

54

56

Crude Oil (WTI) (US$ per barrel)

28

40

37

41

43

46

49

51

53

US Natural Gas (US$ per mBtu)

1.75

2.14

3.01

2.51

2.63

2.68

2.70

2.90

3.00

Spot Asian LNG (US$ per mBtu)

2.14

3.55

6.90

5.20

5.50

5.75

6.25

6.75

7.25

European Natural Gas (€ per MWh)

5.64

8.69

14.74

12.69

13.38

11.75

11.25

13.25

13.25

Coal (Rotterdam, US$ per tonne)

43

54

57

56

54

51

49

46

45

Coal (Newcastle, US$ per tonne)

55

55

58

59

60

59

57

56

55

Sources: Refinitiv, Capital Economics


Economic and Financial Backdrop

Divergence widens as second waves hit

  • While the world economy has made up a lot of ground since the first half of the year, progress has slowed in recent months. The recovery will continue to moderate as fiscal support wanes, the re-opening boost to activity after lockdowns fades completely, and many virus containment measures are either maintained or tightened. Within this global story, we expect the US to outperform Europe in DMs, and for China and some other parts of Asia to pull ahead in EMs, with India and Latin America as the laggards.
  • Recoveries have been rapid by the standards of past downturns. But output is still well below pre-virus levels in most major economies. (See Chart 9.) Indeed, in many cases, the remaining shortfall in GDP is at least as large as the total peak-to-trough fall experienced in the wake of the global financial crisis. (See Chart 10.)
  • Even with output still so subdued, most recoveries are already flagging. Industrial production and retail sales slowed a lot in August. And our Global Mobility Tracker tentatively suggests that the recovery lost even more steam heading into Q4. (See Chart 11.)
  • Admittedly, the pace of the economic bounce-back from lockdowns was never going to last. But now that numerous countries are grappling with a new surge in infections (see Chart 12), heightened consumer caution and renewed government restrictions risk causing fragile recoveries to stall or even go into reverse.
  • However, there are some reasons why we think the economic fallout stemming from renewed outbreaks will be much smaller this time. For one thing, in countries that suffered severe first waves and draconian lockdowns earlier in the year, the overall health situation is much better than it was. With infections concentrated among younger people, as well as there being more ventilators, PPE, and treatments available, there has been less pressure on health services and far fewer deaths. (See Chart 13.) So, the case for full-scale lockdowns is weaker.
  • What’s more, while restrictions will no doubt be tightened further in afflicted countries, we suspect that they will generally continue to be more targeted than the blanket firm closures in March and April. This will keep a larger proportion of economic activity going.
  • Some parts of the economy – such as leisure, hospitality, and transport – are still vulnerable even to targeted restrictions. But these sectors tend to make up a small share of total activity. And having fallen so far in Q2 and since recovered only partially, there is less scope for output in these sectors to fall. Meanwhile, systems for government support for firms and households are already up and running.
  • Resurgences of the virus in Europe have led us to revise down our growth forecasts to below consensus. We have lowered our global GDP forecast accordingly. (See Chart 14.) After a 4.5% decline this year, we now expect a 6.3% rise in world output in 2021, down from a forecast of a 7.1% increase in our Q3 Outlook. This will leave plenty of spare capacity to keep inflation subdued in most economies, allowing central banks to keep policy very loose.
  • As beneficiaries of large-scale fiscal support this year, recoveries in China and other parts of Asia, as well as the US and some other DMs are on a decent footing. (See Chart 15.) In contrast, India and most of Latin America will remain the laggards in the global recovery. (See Chart 16.) Regardless of whether an effective vaccine is rolled out soon, compared to much pessimistic commentary, we doubt the pandemic will have large lasting negative effects on global growth.

Economic and Financial Backdrop Charts

Chart 9: Percentage Changes in GDP in Major Economies

Chart 10: Q3 2020 GDP Shortfall from Pre-Virus Level
Vs. Peak-to-Trough Falls in GDP Around the GFC (%)

Chart 11: CE Global Mobility Tracker & Weighted Avg. of Global IP & Retail Sales (Excl. China)

Chart 12: Daily New COVID-19 Infections Per Million Population (7-day Mov. Avg.)

Chart 13: Daily New COVID-19 Deaths Per Million Population (7-day Mov. Avg.)

Chart 14: World GDP
(2019 Prices & International Dollars)

Chart 15: Change in Government Cyclically-Adjusted Primary Balance (%-pts of Potential GDP, 2020)

Chart 16: Percentage Difference Between Latest &
Pre-Virus GDP Forecasts for Q4 2022

Sources: Refinitiv, CEIC, Google, Apple, Moovit, Johns Hopkins, IMF, CE


Oil

Prices to grind higher in 2021

  • We expect oil prices to trade around current levels through to end-2020 before a gradual recovery in demand pushes prices a little higher by the end of next year. We forecast that WTI and Brent crude oil prices will finish next year around $52 and $55 per barrel, respectively. (See Chart 17.) But by 2022, we suspect that the global market will be broadly in balance, which will limit further price gains.
  • Oil prices collapsed in the early part of 2020 as a result of the measures taken to contain the spread of COVID-19. With oil demand having only partially recovered since then, it is unsurprising that prices are still well below pre-virus levels. After all, behavioural changes, including increased working from home and less business and aviation travel, have structurally reduced fuel demand.
  • But more recently, there are signs that the recovery in demand could be stalling in major developed economies such as the US. (See Chart 18.)
  • In fact, we don’t expect global oil demand to recover much further this year. New containment measures imposed in response to a rise in COVID-19 infections in major developed economies (see Chart 19) will probably weigh on demand. As a result, there will be little upward pressure on prices.
  • But it’s not all doom and gloom. We expect global oil demand to rebound a little more in 2021 as economies gradually reopen and economic activity continues to revive.
  • And though we don’t expect global oil demand to have reached pre-virus levels before the end of 2022 (see Chart 20), we think that lower supply will underpin a limited price recovery in the coming year.
  • We expect OPEC+ output restraint to mostly continue this year and next. Indeed, OPEC+ has already committed overproducing members to compensatory cuts by year-end. And in the US, though the rig count looks to have bottomed out, prices still look too low for a material pick-up in production. (See Chart 21.) Accordingly, we suspect that output there will only recover slowly both this year and next. (See Chart 22.)
  • What’s more, if demand shows further signs of faltering, we suspect that OPEC+ will take steps to keep a cap on supply. As a result, we think that the global oil market deficit that appeared in Q3 2020 will persist into early 2022, supporting a limited but continued price rebound. But by end-2022, this is likely to slow as the market comes into balance.
  • Admittedly, historically elevated levels of global crude stocks (see Chart 23) will act as a drag on any price recovery both this year and next. But if, as we expect, the market remains in a deficit between now and early 2022, stocks should ease back towards their 5-year average.
  • As always, there are several risks to our forecasts. Perhaps the biggest risk is that virus infection rates remain high and governments have to delay or even abandon the relaxation of restrictions, which would act as a headwind to the recovery in oil demand and prices.
  • In addition, a Democratic victory in November’s US Presidential Election could result in a new nuclear deal with Iran. If US sanctions are rolled back, Iran would be free to raise oil output, which has collapsed since the US imposed sanctions. (See Chart 24.) All in all, we suspect that the balance of risks to our price forecasts are skewed to the downside.

Oil Charts

Chart 17: Oil Prices (US$ per Barrel, 2020)

Chart 18: Implied US Crude Oil Product Demand
(Mn. Barrels)

Chart 19: New Confirmed Cases of COVID-19
(Thousands, 2020, 7d Mov. Avg.)

Chart 20: Global Oil Demand (Mn. BpD)

Chart 21: WTI Oil Price Required to ‘Substantially’ Increase US Oil Rig Count (% of Respondents)

Chart 22: US Monthly Oil Production (Mn. BpD)

Chart 23: OECD Crude Stocks (Mn. Barrels)

Chart 24: Iran Oil Output (Mn. BpD)

Sources: Refinitiv, OPEC, IEA, Fed Reserve Bank of Dallas, CE


Natural Gas

Ample supply to act as a lid on prices

  • Having collapsed in the wake of the virus-related slump in demand, natural gas prices have surged in the last month. (See Chart 25.) Most of this can be explained by the seasonal upturn in demand ahead of the Northern Hemisphere winter. But the bigger picture is that annual average gas prices will be markedly lower this year than last. We expect prices to rise in 2021-22 as demand slowly recovers.
  • As it happens, even before the pandemic hit, we had expected natural gas prices to ease back this year in large part owing to rapidly rising supply, notably in the US. In fact, US natural gas production has fallen sharply so far this year (see Chart 26) in part because of lower shale oil production and less associated gas.
  • As a result, excess stocks in the US, compared to this time last year, have been falling (see Chart 27), which has also given a lift to US prices. The rebound in prices will inevitably lead to a rise in output (see Chart 28), but demand should also be recovering in 2021. Accordingly, we see average Henry Hub prices rising to $2.80 per mBtu in 2021, up from an estimate of $2.10 this year.
  • The picture appears less rosy in Europe, despite the recent rise in the TTF price. Storage capacity is nearly full (see Chart 29) and we are less positive on the outlook for the European economy. Admittedly, a colder-than-usual winter could always give a one-off boost to prices, but we would then expect prices to fall back sharply in the spring.
  • In the more medium term, supply to the EU looks to be more than ample given the completion of pipelines, including Nord Stream 2, and the ongoing expansion in global LNG supply. EU LNG imports have slumped since the pandemic took hold earlier in the year. And US exports to the EU have fared particularly poorly. (See Chart 30.) While some of this reflects lower US LNG exports in general, there has been somewhat of a backlash against the US LNG industry in certain parts of Europe. It is felt that the Trump administration has ridden roughshod over environmental considerations. France has recently delayed a deal to import US LNG, ahead of an EU-wide debate. Now that US LNG export volumes are ramping back up (see Chart 31), it may be the case that they will struggle to find EU buyers. All told, we forecast that TTF prices will rise to an average of €12.40 per MWh next year, but this would still be lower their 2019 average of €14.60.
  • The recent jump in Asia LNG prices was mainly driven by active buying in the region ahead of the seasonal spike in demand during winter. That said, the fact that the Asian economy (led by China) is bouncing back more quickly from the virus-induced economic slump will offer some support to Asia LNG prices. We expect Asia LNG spot prices to average $6.10 per mBtu in 2021, up from $3.70 this year.
  • Despite the pandemic, China’s LNG imports rose by 27% y/y in January-September. Given this robust growth, it is perhaps surprising that China’s imports from the US have not risen by more (see Chart 32) given the pledges it made in the Phase One trade deal to buy additional US energy products. We expect China’s imports from the US to grow in the remainder of this year and into 2021 as US exports rise.
  • More generally, we forecast steady growth in natural gas demand over the next couple of years. However, governments will be seeking to move away entirely from fossil fuels, including relatively cleaner natural gas, which suggests slower growth in demand in the medium term.

Natural Gas Charts

Chart 25: Natural Gas Prices (US$ per mBtu)

Chart 26: US Natural Gas Production
(Bn. Cubic Metres per Day)

Chart 27: US Natural Gas Stocks & Price

Chart 28: US Rig Count & Natural Gas Price

Chart 29: Europe Natural Gas Storage Capacity (% Full)

Chart 30: Europe’s LNG Imports by Source
(% Contrib. to y/y Growth)

Chart 31: US LNG Exports by Plant
(2020, Bn. Cubic Metres)

Chart 32: China’s LNG Imports (Mn. Tonnes)

Sources: Refinitiv, EIA, Bloomberg, Capital Economics


Coal

A question of how fast, not whether, prices decline from here

  • Given low natural gas prices and the long-running shift towards cleaner energy in many developed economies, the outlook for coal prices was already looking bleak. And it seems likely that the unexpected virus-related downturn in global economic growth will only add to the headwinds facing coal. This will particularly be the case if, as seems likely, economic stimulus packages involve spending on a transition to a greener economy.
  • There was a short-lived jump in front-month coal prices at the end of September as markets started to price in the usual winter-induced uplift in coal demand in the Northern Hemisphere. That said, coal prices in both Europe and Asia are still low by past standards. (See Chart 33.) And although seasonally stronger demand should support prices in the coming months, we expect this will be more than offset by significant oversupply in the global market for at least the next year or so. (See Chart 34.)
  • Despite the bounce-back in Chinese demand for coal in power generation (see Chart 35), Pacific (Newcastle) coal prices remain well over 10% lower than they were a year ago. What’s more, stocks of coal at Chinese ports have fallen in tandem with net imports since the start of this year (see Chart 36) and domestic coal production has plateaued. (See Chart 37.) Dwindling stocks and flat production together with a rapid rebound in the Chinese economy suggest upward pressure on Pacific coal prices.
  • But the recovery in demand for Pacific coal elsewhere in the region is still stuck firmly in the slow lane. Indeed, although stocks of coal at Indian power plants have been declining since May, they remain elevated compared to recent years. (See Chart 38.)
  • Looking ahead, we expect demand for Pacific coal to continue to rise along with the recovery in economic activity. But at the same time, we think that the price of Asian LNG (which competes with coal in power generation) will remain relatively low and the production of coal will rise. After all, China has recently invested heavily in improvements to its coal logistical network, including the Haoji Railway, while India has deregulated its coal market to attract more foreign investment. Accordingly, we think that Pacific coal prices will continue to drift lower over the next few years even as demand picks up.
  • Meanwhile, the price of European (Rotterdam) coal looks set for an even sharper decline. Admittedly, growth in European coal demand (as proxied by coal use in power generation in the “big 4” European economies) has rebounded over the last few months which, together with a decline in stocks of coal held at major European ports (see Chart 39), has helped to push prices higher. (See Chart 40.) But now that policymakers in Europe are being forced to tighten virus-related restrictions, we expect coal demand to fall back.
  • More generally, we think that the COVID-19 pandemic will accelerate the ongoing push towards decarbonising power generation in Europe. For example, the European Commission is actively trying to increase the price of carbon permits by introducing new sectors (including maritime) into the Emissions Trading System (ETS). Once implemented, the higher price of carbon credits should persistently price coal out of electricity generation in favour of alternative energies, such as natural gas and renewables.

Coal Charts

Chart 33: Front-Month Coal Prices (US$ per Tonne)

Chart 34: Coal Market Balance (Mn. Tonnes)

Chart 35: China Coal Use in Power Generation
(% y/y)

Chart 36: China Coal Net Imports & Stocks at Ports
(Mn. Tonnes)

Chart 37: China Monthly Coal Production (Mn. Tonnes)

Chart 38: Stocks of Coal at Indian Power Plants
(Mn. Tonnes)

Chart 39: Coal Stocks at European Ports*
(Mn. Tonnes)

Chart 40: European Coal Demand & Price (% y/y)

Sources: Refinitiv, NBS, EIA, BP, Capital Economics


Long-term Oil Outlook

COVID-19 to hasten peak oil demand

  • We think that measures to contain COVID-19 have accelerated the move towards less oil-intensive GDP growth. (See Chart 41.) And though we still believe that non-OECD oil demand will continue to grow until the early 2030s, we expect that the rate of oil consumption growth will weaken in the years ahead. After all, COVID-19 has made a medium-term economic slowdown in China even more probable given the further expansion of the state’s role in the economy. COVID-19 has also added to the economic headwinds facing many other emerging economies in the medium term. As a result, we forecast that global oil demand will peak around 2030. (See Chart 42.)
  • Meanwhile, there appears little prospect of a shortage of oil in the medium-to-long term. The greater flexibility associated with shale production in the US means that the sort of imbalances that emerged in the oil market in the past are now much less likely. Furthermore, in a world of falling demand and real prices, it is likely that the low-cost producers, such as Saudi Arabia and Iraq, will be the last ones standing.
  • In sum, we expect that declining demand, ample supply and lower marginal costs will progressively weigh on oil prices, such that the real price of Brent crude oil will fall to $35 per barrel by 2050. (See Chart 43.)

Chart 41: Global GDP & Oil Demand (% y/y)

Chart 42: Global Oil Consumption (Mn. BpD)

Chart 43: Real & Nominal Oil Prices (Brent, US$ per Barrel)

Sources: Refinitiv, BP, Capital Economics

Table 3: Key Long-Term Forecasts

Averages

Forecast Averages

2006-2010

2011-2015

2016-2020

2021-2025

2026-2030

2031-2050

Nominal oil price (US$ per tonne)

75

97

56

59

61

66

Real oil price (US$ per tonne)

101

109

57

55

51

42

Nominal oil price (% y/y)

11.5

-3.7

-1.4

7.9

0.4

0.5

Real oil price (% y/y)

8.4

-6.1

-3.4

5.3

-1.9

-1.7

Sources: Refinitiv, Capital Economics


Long-Term Forecast Summary

Table 3: Long-Term Forecasts – End-Period

Actual

Forecasts

2016

2017

2018

2019

2020

2021

2022

2025

Commodity Indices

S&P GSCI Commodity Index

398

442

374

435

370

420

455

465

S&P GSCI Energy Index

187

211

203

210

145

180

180

210

Bloomberg Commodity Index

334

359

321

355

360

380

395

400

 

Energy

Crude Oil (Brent) (US$ per barrel)

57

67

54

66

45

55

60

60

Crude Oil (WTI) (US$ per barrel)

54

60

45

61

42

52

60

63

US Natural Gas (US$ per mBtu)

3.72

2.95

2.94

2.19

2.50

3.00

3.50

5.00

Spot Asian LNG (US$ per mBtu)

9.50

11.20

9.10

5.10

5.50

7.00

9.00

11.00

European Natural Gas (€ per MWh)

19.40

19.65

21.65

11.70

13.75

14.50

15.50

17.00

Coal (Rotterdam, US$ per tonne)

90

95

87

53

55

45

44

40

Coal (Newcastle, US$ per tonne)

88

101

102

68

60

55

52

45

 

Sources: Refinitiv, Capital Economics

Table 4: Long-Term Forecasts – Annual Average

Actual

Forecasts

2016

2017

2018

2019

2020

2021

2022

2025

Commodity Indices

S&P GSCI Commodity Index

348

393

456

420

340

395

435

470

S&P GSCI Energy Index

155

179

228

195

130

160

170

215

Bloomberg Commodity Index

303

336

357

340

325

370

385

400

 

Energy

Crude Oil (Brent) (US$ per barrel)

45

55

72

64

42

50

58

61

Crude Oil (WTI) (US$ per barrel)

45

55

357

57

39

47

56

64

US Natural Gas (US$ per mBtu)

2.55

3.02

3.07

2.53

2.05

2.75

3.15

4.75

Spot Asian LNG (US$ per mBtu)

5.70

7.10

9.73

5.54

3.65

6.05

8.00

10.50

European Natural Gas (€ per MWh)

14.06

17.23

22.25

14.57

9.15

12.40

12.95

17.00

Coal (Rotterdam, US$ per tonne)

59

84

92

62

51

50

45

41

Coal (Newcastle, US$ per tonne)

66

88

107

78

60

58

54

47

 

Sources: Refinitiv, Capital Economics


Caroline Bain, Chief Commodities Economist, +44 (0)20 7808 4055, caroline.bain@capitaleconomics.com
James O’Rourke, Commodities Economist, +44 (0)20 3927 9834, james.orourke@capitaleconomics.com
Kieran Clancy, Assistant Commodities Economist, +44 (0)20 3974 7422, kieran.clancy@capitaleconomics.com

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