![]() The next key level for oil prices will likely be the US$55/bbl mark which is the median breakeven price for US producers The rally could potentially stall ahead of the level given the market-share concerned OPEC. ![]() It is worth noting that we are approximately a month away from the US elections, a political event that is highly likely to induce volatility. As such we may still see some investors turning back to good old gold. -- JINGYI PAN IG Market Strategist |
Geo Energy Resources is expected to benefit from a rise in coal prices. NextInsight file photoPhysical thermal coal prices hit their highest level since the start of 2014 on Tuesday after tougher Chinese transport rules raised freight costs, adding to the earlier impact of Chinese caps on mining.
Morgan Stanley, however, said it was possible domestic Chinese coal supplies could rise sharply in October and November to prevent a supply shortfall, and this "would be a short-term bear point for all coal prices".
Despite the near-term downside risk to prices, there are other supportive factors, including firm demand from developed markets such as South Korea, and across most emerging markets, as well as output cuts in Indonesia and Australia.
Source: Reuters
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