Global warming is set to continue in the coming decades. There are two main strategies to deal with climate change: adapting economies and societies to new conditions and mitigating the global warming process by reducing greenhouse gas emissions.
GLOBAL DEMAND FOR RAW MATERIALS GROWS
According to our analysis, even if governments abandon any mitigation attempt, demand for raw materials is still expected to grow in the medium to long term due to the processes of population growth and urbanisation, the inevitable implementation of some adaptation strategies, and political and strategic considerations that may push governments to introduce protectionist policies, change supply chains, and reduce dependence on imports of fuels, minerals or key components.
OUR FORECASTS
We expect that over the next five years crude oil could trade above its 10-year average, while natural gas and LNG could trade above their pre-crisis average.
We expect industrial metal prices to rise in the medium to long term, driven by underinvestment, growing demand and persistent scarcity.
We expect precious metals, and especially gold and silver, to remain attractive instruments to hedge both geopolitical risks and inflationary risks.
Finally, we expect prices of most agricultural products to rise over the next five years driven by protectionist policies, droughts and less favourable conditions in important producing regions.