Oversupply still an issue for commodities
Ole Hansen, Head of Commodity Strategy at Saxo Bank, sees demand for oil continuing to grow over the coming years. “It’s just a question of time before demand picks up or overtakes supply again. That will happen within the next 18-24 months.” Energy quite literally runs the world, and with US production beginning to fall over the past 6 weeks, some investors are starting to look at the energy market again. This has been reflected in the bounce in oil prices in recent time, however, oversupply is still an issue he says. The slump in commodity prices has been driven be oversupply, and this can only correct itself once prices come down. “We needed a final, sharp move to the downside in order to speed up that process. This is what some investors are looking for before they get back in.” To hear his outlook for oil, iron ore and gold, watch the full interview below.
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