1) Crude oil will break $100. As demand picks up (especially in Asia), stockpiles are reduced, and (undue) inflationary fears mean funds fly into commodities. Consensus across the board is looking at a range of $70-$80, so this is exactly what will not happen.
2) The high for the natural gas prompt month for 2010 will be three times larger than the prompt month low in 2009.
The square root recovery.
3) The US recovery will be much less of a ‘v-shape’ and more of a square root (we are already in the bounce) or a squigle (= wobbly, in a weebles wobble but they won’t fall over kind-of-way). Although US GDP for Q4 ‘09 and Q1 ‘10 is set to come in with impressive gusto, this will not be sustained throughout 2010 as the inventory boost proves to be transitory, consumer spending stutters, a housing recovery splutters, and a waning stimulus package is unable to spur a robust recovery.
Look familiar?
4) Smart grids will be one of the buzzwords of 2010, as public and private funds flow into energy technology as the investment hotspot of the year. All things associated with natural gas will also be a hotspot for investor flows, as the fuel becomes an ever-more attractive option for US non-reliance on global resources.
5) The unemployment rate continues to worsen, despite intermittent blips of improvement. The rate finally peaks closer to 11% than 10%.
6) Inflation causes very little concern in 2010 until the latter stages of the year, after the Fed withdraws monetary stimulus and starts to consider raising rates. This will either put downward pressure on crude oil, as the US dollar becomes more attractive due to an impending higher interest rate, or (more likely) the bosom-buddy correlation between crude and the US dollar comes to an acrimonious end.
7) Equity markets will have a significant correction (10-20%), as realization dawns that a full-steam recovery is already built in to stock prices, and this is just not a plausible outcome. Equities fall as the economy stalls and expectations are adjusted lower.
You go, girl!
8) Emerging markets will defiantly lead the charge in 2010, attempting to drag the rest of the world into recovery with it. China will continue to grow at a blistering pace, all the while keeping the Yuan pegged to the US dollar, effectively locking in a preferential exchange rate for Chinese exporters.
9) Biofuels such as cellulosic ethanol and algae emerge into the mainstream. Big oil, et al, continue to preempt the savior of the renewable fuels standard, and spark a bout of acquisitions in biofuel start-ups. Refiners such as Valero will continue to make acquisitions in the biofuel sector, to diversify into an alternative (no pun) line of business, as traditional domestic refining remains in the doldrums. If even Exxon Mobil are getting in on the act, such acquisitions must be more than political purchases to appease the environmentalists …surely?
10) Susan Boyle starts dating.
[...] nearly managed to avoid making any predictions this year (after last year’s farcical forecasts – $100 oil, rising nat gas prices, Susan Boyle dating, etc..) until Tom Fowler from Fuelfix [...]