Commodity Trends

The Economy Is Weighing on Commodity Prices

June 20, 2023

Marc-Antoine Dumont
Senior Economist

The oil market is tightening as the Organization of the Petroleum Exporting Countries and its partners (OPEC+) continues to cut production and the number of active US drilling rigs falls. However, crude values have weakened amid recession fears. Energy prices are therefore likely to remain volatile over the coming months. We expect crude prices to hover in the US$70 to US$75 per barrel range in the coming months.
The next few quarters are expected to be difficult for industrial metals demand, as further interest rate hikes are possible and the effects of previous hikes have yet to be fully felt in the economy.
The price of gold beat expectations in the first half of the year as US banking turmoil, US debt ceiling uncertainty and recession risk drove investors towards safe haven assets. But it’s expected to come off its recent highs in the next few quarters.

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