For the energy industry, a volatile and uncomfortable year lies ahead. 2016 begins with oil prices under renewed pressure, a result of OPEC's apparently open-ended strategy of maximising supply. Gas and coal prices are also at multi-year lows. In this Insight, we consider five critical macro themes to watch over the next 12 months:
China's pivotal year as the country enters a new, more mature phase of growth;
Geopolitical tension - a volatile Middle East could lead to yet more pressure on oil prices;
What could stop the commodity cycle from turning? 2016 could see OPEC members shifting focus to maintaining individual market shares;
Low tide for commodity-producing economies. Low prices and interest rate normalisation in the US are putting pressure on emerging market commodity producers through 2016;
Corporate – a year of survival. Radical action is needed to balance the books, and companies will need to start adapting to sustained low commodity prices.
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This Macroeconomics and Global Trends Insight report presents our research on this key topic, and draws out the implications for economies and commodity markets.
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Insight | Jan 2016
Global Trends: what to look for in 2016
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