Pimco says worst of commo crunch over

Melbourne

THE worst of the collapse in commodities prices is probably over, with oil poised to gain over the next 12 months, according to Pacific Investment Management Co. Just don't expect a major rebound.

Producers are shelving projects and scaling back output from Arctic oilfields to Indian aluminium mills amid the weakest returns from raw materials since 1999. While the response may help draw a line under the rout, prices are set to remain "lower for longer" because of excess inventories, according to the firm that manages US$15 billion in commodity assets.