Choose your settings
Choose your language
Commodity Trends

Price Downsides Limited by Supply Disruptions

September 19, 2022
Jimmy Jean, Vice-President, Chief Economist and Strategist
Marc-Antoine Dumont, Economist • Joëlle Noreau, Principal Economist

  • The global economy is slowing down as the major central banks continue to tighten monetary policy in response to the worst inflation seen in decades. The demand outlook has been downgraded for several commodities.
  • Oil production has been higher than expected, particularly in Russia, which has contributed to recent weaknesses in prices. Consequently, we’ve downgraded our oil scenario for 2022 to a year-end WTI (West Texas Intermediate) price of US$90 per barrel.
  • A decline in the consumption of goods and a slowing economy, particularly in China and Europe, are setting the stage for a pullback in industrial metals prices.
  • Opposing forces are exerting pressure on the price of gold. On one side, geopolitical uncertainty, an economic slowdown and recession risks are pushing prices upward. On the other side, rising bond yields and a firm US dollar are pulling them down.
  • We could see agricultural prices fall in 2023 due to slackening demand, but only if Ukrainian exports continue. Prices will remain above historic averages but below 2022 levels.

PDF Publication

See the full publication in PDF.