Ample supply to cap oil prices

Commodity prices have remained under pressure from continued dollar strength, although supply concerns in the past week have supported some agriculturals – notably wheat and coffee. US lumber prices continue to benefit from signs of economic recovery. Otherwise, OPEC’s decision to leave its target for oil production unchanged was no surprise, but did underline the prospect of an extended period of ample supply – especially with signs that US output is bottoming out too. Indeed, Brent is now back within a whisker of our end-2015 forecast of $60 per barrel.