Goldman Sachs has issued a bullish outlook for commodities in 2025, particularly emphasizing gold, oil, and copper. Following Donald Trump's victory in the U.S. elections, the bank anticipates significant shifts in policy that will enhance the diversification role of commodities in investment portfolios.
The firm forecasts that gold prices will reach new highs, potentially hitting $3,000 per ounce by December 2025, driven by increasing demand from central banks seeking safe-haven assets and anticipated Federal Reserve rate cuts. Currently, gold is priced at $2,649 per ounce.
In contrast, demand for iron ore faces challenges due to a slowdown in the real estate sector and structural changes in the Chinese economy. Goldman Sachs notes that the consolidation of gold prices post-election, which has purged speculative positions near historic highs, presents an attractive entry point for investors.
Regarding oil, Goldman Sachs expects Brent crude to trade between $70 and $85 per barrel, averaging $76 in 2025, with a peak of $78 in June before declining to $73 in December. However, risks to supply from Iran could intensify, especially in light of the ongoing Israel-Iran conflict. A reduction of 1 million barrels per day from Iran could push Brent prices above $80, while increased U.S. support for Israel might further restrict Iranian supply, potentially driving prices over $90 per barrel.
In a worst-case scenario, the closure of the Strait of Hormuz could see prices exceed $100 per barrel. Despite these risks, medium-term outlooks suggest downward pressure on prices due to high available capacity and the negative impact of tariffs on demand.
Goldman Sachs advises investors to favor copper and aluminum over iron ore in 2025, noting that weakened demand from China clashes with an oversupply of iron ore, keeping prices below $100 per ton. The bank highlights strong structural demand for copper, bolstered by global supply constraints and China's energy policies focused on decarbonization.
According to mining giant BHP, which has announced a $13.7 billion investment plan in various Chilean projects, copper demand is expected to grow by 70% by 2050, reaching 50 million tons annually. Currently, the energy sector accounts for nearly 50% of copper demand in China, driven by clean energy initiatives and infrastructure expansion.
Goldman Sachs expects copper prices to range between $9,000 and $10,000 per ton in the first quarter of 2025 due to seasonal inventory accumulations. For the year, the average price is projected at $10,160 per ton, marking a 13% increase from current levels. The firm believes that copper will play a crucial role in the energy transition and will be a strategic component for long-term investment portfolios.