Africa-Press – Eritrea. Wars in the Middle East and Ukraine, upcoming elections in many countries and rising regulatory uncertainty for natural resources have renewed the focus on geopolitical and political risks for commodities markets, Fitch Ratings said Monday.
“We expect the geopolitical price premium to continue for most commodities – including oil and gas, copper and defensive commodities such as gold – but faltering economic growth along with significant spare oil capacity will limit the price rally,” it said in a statement.
Fitch said global demand growth across commodities including oil, copper and aluminum is likely to weaken this year.
It noted that China’s economic growth forecast is less than 5% as the world’s second-largest economy struggles to stabilize its property market.
The rating agency said the large spare capacity of OPEC+ with five million barrels per day of oil production provides a significant buffer to mitigate disruption in the oil market.
In addition, the European natural gas market remains comfortably supplied, it added.
“We do not expect the temporary pause in approvals of US liquefied natural gas export facilities to affect global LNG supplies in 2024,” Fitch said.
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