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Source:\u00a0Wood Mackenzie<\/p>\n
Macroeconomics: Asia\u2019s consumers are key<\/strong> China\u2019s economy is evolving and the nature of its energy demand growth is changing. A more rapid than expected shift to consumption led-growth could slow energy demand. In Japan, consumption needs to accelerate to kick-start GDP growth and alleviate the risk of a sovereign debt crisis. In 2015 the behaviour of Asia\u2019s consumers will have material impacts on the global economy.<\/p>\n Coal: China\u2019s shift to cleaner consumption<\/strong> A twin-pronged approach to environmental protection and support for domestic mining companies means a shift to cleaner coal consumption and a reduction of seaborne imports. Details of the 13th Five Year Plan will become clear in 2015, but are likely to accelerate the drive towards a more sustainable China. Such policies could mean further damaging impacts on global coal producers.<\/p>\n Metals & mining: China\u2019s Five Year Plan and commitment to infrastructure build<\/strong> Metals and mining are highly exposed to China, which is the primary driver of demand growth for many mined commodities. Details of the 13th Five Year Plan will indicate China\u2019s commitment to infrastructure build-out over the medium term, and will be key for the mining industry to position itself for the next phase of the country\u2019s growth. \u201cFrom 2015, LNG markets face rapid supply growth, led by Australia and followed into 2016 by the US, from the Gulf Coast. Suppliers will be looking closely at Asia\u2019s gas demand growth,\u201d\u00a0Noel Tomnay, Head of Global Gas and LNG.<\/p>\n Slowing gas demand growth has led to concerns that China will struggle to absorb contracted LNG, which will double over the next three years. Suppliers will be hoping for a cold 2015, but the background of a low oil price environment will place pressure on LNG prices. However long-term growth prospects remain compelling, and Russia will continue to cement its pivot east with China gas deals.<\/p>\n Oil markets: Struggling to find balance in 2015<\/strong> The strength of oil demand growth in 2015 is a major concern, and a weaker than expected economic outlook could exacerbate the current market imbalance. If a non-OPEC supply response is not enough to rebalance the market then attention will fall on the Middle East, and OPEC\u2019s next meeting, during the summer months. Oil market rebalancing in 2015 is likely to deliver price volatility and a period of uncertainty.<\/p>\n Corporate: A true buyers\u2019 market could emerge in 2015<\/strong> Corporate valuations are now heavily discounted, as investors digest a sub $70 per barrel oil. Companies are weighing up options and distressed sales could precipitate the emergence of a buyers\u2019 market in 2015. Those with the financial strength to withstand weak prices will be well positioned for the next cycle.<\/p>\n
\n\u201cThe rate at which China\u2019s economy rebalances away from investment and towards consumption will determine long-term trends in energy demand,\u201d\u00a0Cynthia Lim, Senior Economist.<\/p>\n
\n\u201cProtecting both domestic mining companies and the environment mean China\u2019s role as an ever-growing coal export destination is under threat\u201d,Jonny Sultoon, Senior Analyst \u2013 Coal markets.<\/p>\n
\n\u201cAn evolving China presents challenges to the metals and mining industries, but demand is robust, and the call on mined output remains strong,\u201d\u00a0Mike Sinden, Principal Analyst \u2013 Investment Research.<\/p>\n
\nNatural Gas: LNG suppliers hoping for cold<\/p>\n
\n\u201cThe oil market is looking for a price floor where constraints on supply growth in 2015 could start to emerge and help rebalance supply and demand,\u201d\u00a0Ann-Louise Hittle, Head of Macro Oils.<\/p>\n
\n\u201cOil companies must adapt quickly to this period of low oil prices,\u201d\u00a0Tom Ellacott, Principal Analyst \u2013 Corporate<\/p>\n