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Most prices fell this week as soaring COVID-19 cases in China raised concerns about the country’s commodity demand. Given the negative impact of COVID-related lockdowns on travel, it is no surprise that there was particular weakness in the price of …
18th November 2022
Commodity prices surged late in the week on the back of a slump in the US dollar, a fall in US real yields and some easing of COVID-related restrictions in China. However, we doubt that this heralds the start of a renewed upturn in prices. The …
11th November 2022
Most commodity prices rallied on Friday as rumours circulated that China was considering a relaxation of its zero-COVID policy. However, in the absence of any official statements to that effect and the relatively low levels of vaccination, we are …
4th November 2022
Most commodity prices tracked the US dollar this week, falling sharply at the start of the week before staging a partial recovery in the latter half. Further dollar appreciation is likely given that the Fed looks set to raise its target rate by a chunky …
28th October 2022
The big story this week has been the roughly 20% week-on-week fall in the European natural gas price , as mild autumn weather has combined with weak economic activity and the still-high gas price to drag demand lower than usual for the time of the year. …
21st October 2022
This week, commodity prices continued to be caught in the middle of an ongoing tug of war between tight supply and deteriorating demand. We ultimately expect that to play out in two different ways over the rest of this year. On the one hand, the deficit …
14th October 2022
Crude oil prices rose by around 10% this week as OPEC+ announced a 2m bpd cut to its production quota, which all but guarantees that the market will be in a deficit in Q4. Accordingly, we are sticking to our forecast that the oil price (Brent) will be …
7th October 2022
The US dollar completed a round trip this week, continuing its relentless rise against most currencies early in the week, but then started to fall back from Wednesday afternoon and is now a touch lower than where it started. Predictably, this weighed on …
30th September 2022
Most commodity prices plunged this week on the back of monetary tightening by many major central banks, including the Fed, and an appreciation of the US dollar. There is still considerable uncertainty about the scale of the global economic downturn, but …
23rd September 2022
Most commodity prices have struggled to make gains since the US August CPI data were published on Tuesday. The unexpectedly strong reading prompted a rise in Treasury yields and US dollar appreciation, both of which are negatively correlated with …
16th September 2022
Energy markets took centre stage this week as demand concerns outweighed supply concerns, dragging prices down. Even the decision by OPEC+ on Monday to cut oil output quotas for October by 100,000 bpd failed to prevent the Brent crude oil price sliding …
9th September 2022
Growing fears about demand hit all commodity groups hard this week as China tightened restrictions in response to renewed virus outbreaks. Energy prices took a big leg down from their highs reached last week , particularly natural gas, despite gas flows …
2nd September 2022
We’ve raised our near-term natural gas and coal price forecasts across the board this week to account for the recent slump in Russian natural gas exports to Europe, the likelihood that those exports will remain low, and the knock-on effect that higher gas …
26th August 2022
It was another week of soaring natural gas prices as LNG demand from Asia appears to have picked up and the energy crisis in Europe deepens by the day . Ultra-dry and hot weather across Europe is creating problems with Norway’s hydropower and France’s …
19th August 2022
This week the prices of most commodities got a boost as investors pared back expectations for rate hikes in the US , following lower than expected inflation data. That said, we still expect a further small rise in the US 10-year Treasury yield by the end …
12th August 2022
In a week of relative financial market calm, there was a pause in the large, sentiment-driven swings that have characterised most commodity prices in recent weeks . Instead, prices seemed to take direction from more fundamental drivers. That said, the …
5th August 2022
The prices of most commodities across energy, metals and agriculturals rose this week. The common driver was investors dialling back their expectations of the aggressiveness of US monetary policy tightening , after data showed GDP contracted for a second …
29th July 2022
It was a more positive week for prices, in large part owing to some softness in the US dollar . Otherwise, the news was not particularly positive for prices given the ECB’s surprise decision to hike its policy rate by 50bp (having signalled 25bp), …
22nd July 2022
Most commodity prices fell this week as global monetary tightening and fears about economic growth intensified . The high June inflation reading in the US nails on another large rate hike at the FOMC’s meeting in July. And central banks in Canada and …
15th 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
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
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 …
24th 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
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
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
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
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
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
Russia’s monopoly exporter of natural gas, Gazprom, suspended gas deliveries to Poland and Bulgaria this week because they refused to pay for Russian gas in rubles . There is some confusion about whether the process by which Russia demands rubles to be …
29th April 2022
It has been an unusually quiet week for commodities, with less volatility than we have come to expect . The war in Ukraine continues to provide possible stresses for supply but, for now at least, it seems the market focus is shifting to demand as well, …
22nd April 2022
The war in Ukraine continued to dominate headlines, and commodity price movements, this week as peace talks fell apart and sent energy prices up sharply . However, at the same time, there are further worrying signs of a downturn in China’s commodities …
14th April 2022
Last week, we suggested that the downside risks to prices were building, and these came to the fore in the past week with particularly hawkish US Fed minutes published on Wednesday and ongoing COVID-19 related lockdowns in China. The announcement of a …
8th April 2022
Signs of weaker demand in China in the latest PMI data and the announcement that the US will sell off a large chunk of its strategic oil reserve suggest that the downside risks to commodity prices are building . Admittedly, while oil prices fell sharply …
1st April 2022
Taking the lead from energy, most commodity prices rose this week as hopes of an imminent ceasefire in Ukraine faded and Western leaders met to consider further sanctions on Russia . Meanwhile, Putin’s announcement that natural gas purchases could only be …
25th March 2022
Commodity prices remained extremely volatile this week . After all the supply fears associated with the war on Ukraine, a rising number of COVID-19 cases in China raised concern about both demand and supply given widespread lockdowns in key industrial …
18th March 2022
The seemingly unstoppable rise in commodity prices gave way to sharp corrections this week, though the big picture is that prices remain extremely elevated . We suspect commodity prices will continue to whipsaw around in the weeks ahead, as markets move …
11th March 2022
Although many commodity prices are already back to levels last seen in 2008, there is still scope for prices to rise further if Western sanctions are extended to cover energy commodities . (At the end of this Weekly Wrap , we publish forecasts in a …
4th March 2022
We have raised most of our commodity price forecasts this week to account for Russia’s invasion of Ukraine and the heightened risk of disruption to commodity supply . Given that Russia is a leading exporter of many commodities, prices will stay high so …
25th February 2022
It was a rollercoaster week for many commodities as tensions between Russia and the West over Ukraine ebbed and flowed and the West held talks with Iran over a new nuclear deal. In the end, it was signs of progress in the Iran talks that pushed oil prices …
18th February 2022
Growth in China’s economy has slowed sharply and US interest rate expectations have jumped but commodity prices continue to hold up well . In some cases, constrained supply explains the resilience in prices and, in others, there are fears of supply …
11th February 2022
OPEC+’s reluctance to consider a more radical adjustment in its output policy this week raises the risk that production falls short of the group’s target this year . Admittedly, the group agreed to a further 400,000 bpd increase in output in March. But it …
4th February 2022
The US Fed announced at its meeting this week that it will “soon be appropriate” to raise interest rates and hinted that a hike was coming as soon as March . (See here .) The US dollar strengthened, with the DXY index hitting an 18-month high of over 97, …
28th January 2022
Despite falls in the prices of most other risky assets, including equities, commodities held up well this week . The prices of equities and commodities tracked each other relatively closely throughout the pandemic, but they have diverged sharply since the …
21st January 2022
Most commodity prices increased this week, with coal prices leading the pack on the back of Indonesia’s ban on coal exports this month. That said, we don’t see commodity prices rising for much longer . Indeed, Chinese imports of most raw materials fell …
14th January 2022
The experience of South Africa (see here ) with the Omicron variant seems to have allayed investors’ fears over commodity demand. Indeed, the net long position held by investors in the oil futures market has begun to rise, indicating an improvement in …
7th January 2022
It was a week of central bank decisions, culminating in ‘Super-Thursday’. (See our Drop-In here .) The big picture is that central banks generally sounded more concerned about the rise in inflation , despite the ongoing spread of the Omicron variant. …
17th December 2021
Oil prices fell briefly on Thursday after OPEC+ decided to push ahead with its plan to raise oil output by 0.4m bpd a month, despite plunging oil prices since news of Omicron broke . Prices recovered shortly after, though, probably because OPEC+ left the …
3rd December 2021
Most commodity prices fell on Friday after South African scientists declared they had identified a new COVID-19 variant on Thursday which may be more transmissible. We think it’s still early days to say what this means for the global economy, but it has …
26th November 2021
This week showed that the energy crisis is not in the rear-view mirror just yet . Germany’s energy regulator suspended its certification process of the Nord Stream 2 pipeline on Tuesday, owing to issues regarding the organisational structure of the …
19th November 2021
Despite falling short of its targeted increase in output once again in October, we think OPEC+ will continue to snub calls to raise output more rapidly . The week began with comments from the Biden Administration that OPEC+ was imperilling the global …
12th November 2021