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Gold consumption will increase in the coming days, says International Gems Institute

Updated : October 28, 2019 06:13 AM IST

Edward Morse of Citi, Pritam Patnaik of Reliance Commodities and Tehmasp Printer, managing director of International Gems Institute, India (IGI), spoke about the prospects of crude, gold and other commodities, in an interview with CNBC-TV18.

Morse said crude prices should have been $70 per barrel if it wasn’t for machines, algorithmic trading.

“When we look at next year, we like almost everyone else believe there will be a surplus but that surplus is not as big as the spread between supply and demand because of the deficit we are now in,” he added.

“So yes, we think that there is going to be at least 2 million barrels a day of new supply in the system. In 2020 we think there will be a little over million barrels a day of demand that sounds like a million barrels a day of inventory build but it’s not because we have the catch-up to do,” Morse added.

On India front, he said: “The expectation is that the Indian economy is going to grow at a better rate going forward than it has in the pre- and post-election period of time. So we will wait and see, but yes, Indian demand growth has been a little bit more sluggish than anyone.”

Talking about crude price, Patnaik said, “Organisation of the Petroleum Exporting Countries (Opec) is a very strong organisation. Today if they decide to cut production and get the crude oil prices higher, I do not see a reason why we couldn’t see high, but I would be skeptical about $70 per barrel. I would price it around $65 per barrel.”

Printer of IGI said: "We expect more gold consumption due to more auspicious days going ahead."

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