I had the opportunity to share my thoughts on the oil, gold and coal markets. Please click on this link to access the interview:



One of the key drivers of gold’s price ascent has been the strength of global central bank buying. This buying more than coincidentally has coincided with the escalating of global debt, which has impacted the value of currencies around the world. The first graphic shows the correlation between the ascent of the gold price from the year 2000 with the surge in US public debt (as a % of GDP) and also the growth in US federal deficits.

There are various reasons as to why central banks worldwide have cranked up their gold buying over the past 25 years.

  1. Diversification of foreign reserves – global central banks, in particular Russia and China, have been keen to move away from their reliance on the US currency – thus boosting their gold buying.
  2. Rising global debt levels – over recent decades in particular, the level of global debt has grown enormously, which in turn has reduced the value of fiat currencies (currencies not backed by gold). Central banks are thus aware of the reduced value of their own currencies, and are buying gold as a hedge against this loss of value.
  3. US debt escalating – central banks have witnessed the climb in US debt, which is impacting the US domestic economy in terms of rising interest payments, as well as impacting the strength and value of the US currency.

The second graphic shows the relative performance of the US dollar since the year 2000. The US dollar is up 6% while the gold price is up by 550%.

Another important aspect of the current gold market is the relative outperformance of the Australian dollar gold price, as reflected in the five-year price graphic (gain of 109% v 88%). The trajectory of US interest rate increases in the post-covid period has seen it outperform all other global currencies, which has boosted the relative performance of gold in A$ price terms.

This is being reflected in the underlying performance of gold equities, with Australian gold producers outperforming US producers, boosted by healthier operating margins. That said, gold equity valuations worldwide are still ~3 years behind where they should be relative to the underlying movement in the price of gold, so there’s a lot more upside for gold equities.


There are important factors driving the oil price at present – robust demand and political risk fears in the Middle East that won’t go away, plus OPEC+ supply discipline.

Let’s not forget how important the oil sector is in terms of the world economy, where it remains the commodity sector. At $2.1 trillion, the oil sector is 7.5 times larger than the next biggest commodity, iron ore.

And crude oil’s importance for the world economy is not going away anytime soon, as it remains a critical component, particularly in transportation and aviation. If we look at EV sales, in Australia they are gathering pace as our take-up has been delayed compared with international markets. But in Europe, the European Automobile Manufacturers’ Association reported late last week that sales of electric cars fell by 11.3% in the EU during March, and in Germany alone by 28.9%. And in both the US and Europe, emissions legislation has been pushed back out of necessity.

For 2024, oil demand is forecast to grow ~1.5 mb/d, underpinned by rising demand for jet fuel and petrochemical feedstock.


China’s love affair with coal shows no signs of ending any time soon, which means that coal will remain a key factor in the world’s energy mix for some time to come, which is great news for our coal producers.

This view is reinforced by a just-released coal industry study by US-based think tank, Global Energy Monitor (GEM). According to the group’s research, the world’s coal-fired power capacity grew by 2% last year – representing the highest annual increase since 2016. The growth was driven by new coal-fired builds in China, together with decommissioning delays elsewhere.

In all, nearly 70 gigawatts (GW) of new coal-fired power capacity were commissioned across the world last year, including 47.4 GW in China (representing 68%). Interestingly too, coal-fired capacity outside of China also grew for the first time since 2019 (the majority in Asia), whilst worldwide only 21.1 GW was shut down. The study also estimates that another 578 GW of coal-fired capacity is in development, of which China’s share is 72%, comprising 408 GW (enough to power the whole of India). (graphic attached).

Presently, just under 200 GW of coal-fired power is under construction worldwide, of which China accounts for 140 GW – or 70%. And China’s coal plant retirement rate, amid concerns over energy security, was also at its lowest in a decade last year.