Oil Price
Commodities, including crude oil, are set for a good year, which could turn into “fantastic” if planned interest rate cuts materialize, according to veteran analyst Jeff Currie, who left Goldman Sachs last year after nearly 30 years at the helm of the bank’s commodity research division.
All commodities are set for bullish moves in 2024 amid low inventories and record-high demand for raw materials, Currie, who is often bullish on the sector, told Bloomberg television in an interview on Monday.
“The set up for all of these markets is better than it was last year,” Currie told Bloomberg.
Should central banks start cutting interest rates, “you’re teeing yourself up for a fantastic 2024,” the veteran analyst added.
“This is just classic ‘own commodities.’”
Currently, traders are bearish on crude, after losing money in 2023, but this year the “immaculate disinflation” and the jump in non-OPEC production from last year are unlikely to repeat, according to Currie.
The former Goldman Sachs analyst had correctly predicted the boom in commodities in the 2000s, driven by China’s robust economic growth which needed a lot of commodities.
Last year, Currie expected a bumper year for commodities in 2023 due to supply shortages and insufficient investment in new supply. Currie has also called a “commodities supercycle” several times over the past two years.
This prediction failed to materialize, at least for crude oil, which ended the year lower than the levels at which it started 2023.
Oil prices, which had averaged above $100 per barrel in 2022, were significantly lower in 2023 and averaged just above $80 a barrel—despite another war breaking out in the world.
Last year, Brent Crude oil prices averaged $83 per barrel, compared to an average price of $101 a barrel in 2022—a difference of $19 per barrel after rounding, according to estimates by the U.S. Energy Information Administration.
By Tsvetana Paraskova for Oilprice.com
