Five key charts for global commodities this week

Bloomberg — Top gold executives gather in Denver this week, while energy executives from around the world gather in Calgary and climate experts and policymakers descend on New York. Are huge sectoral meetings lay the groundwork for intense debates on the most important raw materials in the world.

Energy

The oil and gas industry gathers at the World Petroleum Congress, in the nerve center of Canadian energy, where this year’s motto, zero emissions, faces debate on market fundamentals and the political situation behind fossil fuels. Furthermore, these issues are important for the US president’s re-election campaign, Joe Biden, which is beginning to gain strength at a time of rising crude oil prices and supply restrictions. Saudi Arabia and Russia are extending their unilateral crude oil supply reductions until December, which will increase the attention paid to domestic production. The barrel of Brent rose to US$95 on Monday, extending a vigorous rise caused by supply cuts and strong demand. Meanwhile, gasoline prices in the United States, which are at a seasonal record, are attracting the interest of Republicans eager to criticize President Biden’s economic and climate policies. The price of gasoline is one of the most obvious signs of inflation, and consumers often blame the White House for rising prices, even though the president has little control over the situation. Rising fuel prices will surely be a key issue for undecided voters that Biden will need on election day.

Climate

The annual New York Climate Week event will bring together senior policymakers, business leaders, climate experts, and more. This meeting takes place less than a fortnight after a historic UN assessment that reveals that countries are largely failing to meet their commitments to cut emissions, threatening the planet with catastrophic global warming. According to the United Nations report of September 8, governments will have to quickly achieve the reduction of billions of tons of CO₂ if they intend to prevent global warming from exceeding 1.5ºC by the end of this year. decade. During this northern summer, extreme heat waves were recorded in North America, Europe and Asia.

LNG, (liquefied natural gas)

For the first time, the United States is poised to become the world’s largest supplier of LNG, as global export data for the first half of this year indicates the country surpasses Australia and Qatar. The advance registered in the US is largely due to the resumption of activity at Freeport LNG, in Texas, after its closure in 2022 due to a fire. Elsewhere, strikes threaten LNG at Chevron’s two Australian plants, causing traders in Europe and Asia to react to fears over supply in the spot market ahead of peak winter demand in the northern hemisphere. The US seeks to unseat Qatar from first place as a global supplier due to its abundant shale resources and in the face of interest from global buyers after the invasion of Ukraine in 2022, which has reduced gas from Russia to Europe.

Gold

When investors, gold miners and bankers converge at the Denver Gold Forum this week, the valuation of bullion miners and how that influences future acquisitions will be a priority. However, the resilience of gold prices has made the safe haven a better investment than the companies that mine the precious metal. Gold has returned more than 10% over the past 12 months, while a Bloomberg Intelligence index with big names such as Newmont Corp. (NEM), Barrick Gold Corp. (GOLD) and Agnico Eagle Mines Ltd (AEM) . has gone down. Miners are struggling with missed production targets, rising costs and operational challenges, while gold has remained stable despite a higher interest rate environment that typically reduces the metal’s appeal as it pays no interest. Gold rose as much as 0.4% on Monday to US$1,930.67 an ounceextending last week’s 0.3% increase.

Cotton

The drought has taken its toll on U.S. cotton, with dryness and heat undermining production in Texas, which produces about 40% of the U.S. crop. The fastest growing state just recorded the second hottest summer in history and is almost completely in drought, which harms the quality of crops and threatens fiber production. The United States just lost its title as the world’s third largest cotton producer, and US government figures released last week show that Brazil is rising in the rankings. It’s a notable setback for a nation that led the world in cotton production for much of the 1960s and 1970s, with China then taking the lead. Over the past four decades, that American dominance has dissipated as India, China and Brazil have ramped up production. Cotton futures rose as much as 1.2% on Monday in New York, the biggest intraday gain in more than a week.

With assistance from Chunzi Xu, Ilena Peng, Yvonne Yue Li, Jacob Lorinc, Sophie Caronello, Jessica Shankleman and Ruth Liao.

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