After a drop below 170 in August, the CRB-index recovered to 180. The main driver was higher WTI crude prices, which account for 23% of the index. We expect more range trading in Q4.
Commodity price outlook
The attack on Saudi oil infrastructure facilities reminded the market of possible impacts of geopolitical risks. Although the existing downside price risks for oil did not vanish, geopolitical risks led to increased upside price risks. As a result, oil prices seem to be caught between extremes.
We think gold prices may have found too much support. A profit taking wave could easily push prices back towards our expected 1,400/ounce at the end of the year.
The trade conflict and high inventories cap the upside for base metals, especially for aluminium, copper and zinc. Loose monetary policy should be supportive, but mainly into 2020.
Agri show a mixed picture. Although the high stock levels will decline somewhat, the upside potential of most prices seems to be limited.
Monthly-Commodity-Insights-September-2019-1.pdf (882 KB)