Video Series:

Macro asset-classes

“Commodities demand broadly will likely continue to undergo a meaningful shift through 2021. As vaccinations begin to sustainably break the link between COVID-19 infections and mobility, we will see a shift in the driver of growth from metals-intensive goods to more energy-intensive services.” Natasha Kaneva, Head of Global Commodities Strategy

COVID-19 Recovery: Improved mobility will maintain demand recovery for oil. This raises more caution on the demand prospects for base metals.

Oil Demand: Global oil demand should be inflecting higher by around 4.6 mbd over the course of summer, a recovery stronger than the 2019 seasonal bounce by more than 2.7 mbd.

U.S. production is not expected to rise until late 2021, so expected increases in OPEC+ and Iranian production will be absorbed by the anticipated demand lift, while inventories continue to be drawn from.

This environment will likely keep Brent oil prices at an average of $74/bbl in 2H21, peaking at around $80/bbl by year-end.