Citigroup strategists say in a report on the outlook for commodity markets in 2025 that the backdrop for “at-risk” commodities such as oil and base metals is relatively bearish, but the outlook for gold is said the company is “relatively bullish” due in part to the deteriorating economy. US job market.
U.S. President-elect Donald Trump will inherit a significantly weaker domestic and global economic environment compared to his first term as president, strategists said. The US and global growth prospects are also likely to become “more challenging” as the US increases tariffs on Chinese imports in the first quarter of next year.
Citigroup strategists said the global oil market is likely to be in surplus in 2025 even as the group of major oil producers known as OPEC+ maintains current production levels. They forecast an average surplus of 800,000 barrels per day in 2025. Against this backdrop, we expect oil prices to fall by 15% to 20%, with Brent reaching $60 per barrel by mid-2025, and prices likely to remain that way. In the basic scenario, it will be around that level in the second half of 2025 and 2026.
Still, they are underpinned by a continued deterioration in the US labor market, high interest rates still weighing on growth, and rising demand for exchange-traded funds (ETFs). is viewed as “relatively bullish.” The strategists maintained their zero-to-three-month gold price target at $2,800 per ounce and the six- to 12-month gold price target at $3,000 per ounce.
