Copper is the new oil and prices will rise 50% to $15,000, the analyst said

A leading commodities analyst says copper is emerging as the next indispensable industrial commodity, mirroring the rise in oil prices in previous decades.

According to Jeff, this time, new forces in the economy, namely the advent of artificial intelligence, the data center boom and the green energy revolution, are driving demand for copper. , and the development of new weapons also contributes to that need. Currie, director of strategy for Energy Pathways at Carlyle.

“Copper is the new oil,” he said Bloomberg TV on Tuesday, noted that his conversations with traders also reinforced his optimistic view. “This is the most convincing transaction I have ever seen.”

Copper has long been an important industrial material as it is used widely from manufacturing and construction to electronics and other high-tech products.

But billions of dollars pouring into artificial intelligence and renewable energy are a relatively new part of copper’s outlook, Currie noted, admitting that he has created a Similar predictions are expected in 2021 when he was an analyst at Goldman Sachs.

“I am confident that this one has been successful and I think we will see more momentum behind it,” he said. What’s different this time is that there are now three sources of demand—AI, green energy, and the military—instead of just green energy like three years ago.

And while demand is high, supply remains tight because bringing new copper mines online can take 12 to 26 years, Currie pointed out.

He predicts that will eventually cause prices to spike to $15,000 a ton. Copper prices have hit a record high, with the benchmark price in London at around $10,000 a ton, more than double the pandemic-era low in early 2020.

At some point, prices will rise so high that they create “demand destruction,” meaning buyers are reluctant to pay too much. But Currie doesn’t know how much that is.

“But I go back to the 2000s, and I was as bullish on oil prices as copper is today,” he added, recalling that crude oil prices rose from $20 to $140 a barrel at the time. there. “So the increase in the price of copper here is very significant.”

Copper was also a key catalyst in BHP’s proposed takeover of the company. British American, a $40 billion deal that will create the world’s leading copper producer. But Anglo rejected the offer and recently announced plans to restructure the group, including sale of De Beers diamond business.

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