Commods investors shrug off market drop as correction

HONG KONG (Reuters) – Large money managers, echoing comments by the International Monetary Fund, are shrugging off a recent drop in commodities prices as a short-term blip and predicting gold prices will soar to $1,500 an ounce.

… Speakers at the Commodity Investment World Asia conference in Hong Kong on Tuesday cited supply constraints and insatiable demand from India and China as catalysts that will keep driving prices of commodities like oil higher.

“Everyone’s blaming the (oil) companies (for high prices) but it’s just what people are willing to pay for it,” said Kjell Aleklett, president of the Association for the Study of Peak Oil.

Oil has been trading at above $70 a barrel and some believe Middle Eastern conflicts and demand from emerging economies may push it to top $100 a barrel at some point, a price few would have believed just a year ago.

Aleklett said the world will face an oil shortage of 30 million barrels a day by 2030, underscoring the demand-supply imbalance that investors say will keep commodities prices rising for a long time, despite a market correction since mid-May.

Reuters