ET Now: What about the argument that there is a growing population in the emerging markets and that will support grain prices because of the need to feed more mouths?
Nouriel Roubini :
Certainly, demand for oil, energy, water and food is going to increase
in the emerging markets, thanks to a growing population and increasing
per capita income. Therefore, those commodities that are related more to
the consumption growth in China and emerging market, in relative terms,
might be the better placed - like oil - as transportation needs would
sustain demand. However, industrial metals like copper, in less
resource-intensive emerging markets, are going to do much worse in
relative terms.
NOURIEL ROUBINI BLOG tracks the media appearances of Dr Nouriel Roubini his interviews articles debates books news speeches conferences blogs etc..Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics
Showing posts with label OIL. Show all posts
Showing posts with label OIL. Show all posts
Saturday, October 5, 2013
Saturday, August 3, 2013
OIL : we think the market can go slightly lower, say, toward $90 a barrel
What are your thoughts on other commodities?
Nouriel Roubini : We are concerned about base metals, because the slowdown of China may end up a hard landing, which implies that demand for things like copper and others could really sink. In the case of oil, we think the market can go slightly lower, say, toward $90 a barrel, but it’s probably not going much lower than $90, and $100 to $110 maximum; that’s the range for oil. Because demand is growing less and supply is increasing, you might have some softness in oil prices. But then there also is geopolitical risk. If there is a war between Israel and Iran, that could lead to an increase in the sale premium.
Soft commodities, especially agriculture and food, are slightly better supported and less cyclical. Emerging markets are still urbanizing and naturalizing, having high per capital income growth and having population growth with a few exceptions. Demand for food is going to rise over time.
Natural gas prices are going to go higher, as the U.S. starts exporting more. Prices are low in the U.S. and very high in the rest of the world. There’s a gap between very low U.S. prices and high global prices. That is going to be arbitraged. - in indexuniverse
Nouriel Roubini : We are concerned about base metals, because the slowdown of China may end up a hard landing, which implies that demand for things like copper and others could really sink. In the case of oil, we think the market can go slightly lower, say, toward $90 a barrel, but it’s probably not going much lower than $90, and $100 to $110 maximum; that’s the range for oil. Because demand is growing less and supply is increasing, you might have some softness in oil prices. But then there also is geopolitical risk. If there is a war between Israel and Iran, that could lead to an increase in the sale premium.
Soft commodities, especially agriculture and food, are slightly better supported and less cyclical. Emerging markets are still urbanizing and naturalizing, having high per capital income growth and having population growth with a few exceptions. Demand for food is going to rise over time.
Natural gas prices are going to go higher, as the U.S. starts exporting more. Prices are low in the U.S. and very high in the rest of the world. There’s a gap between very low U.S. prices and high global prices. That is going to be arbitraged. - in indexuniverse
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