Goldman Sachs is raising its 12-month commodity returns forecast to 6.4% — a 3% increase — based on subsiding geopolitical tensions.

The firm said that following clarity on the US-China trade deal and UK election, demand for commodities will increase, without any changes to supply. For oil specifically, the firm raised its returns forecast to 15% from 9.7%.

“Tighter than expected agriculture markets due to supply problems and an improved outlook on oil following the OPEC+ agreement reinforce our overweight recommendation,” Goldman analysts led by Jeffrey Currie said in a note to clients Monday.

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