1. COMMODITY PRESENTATION OLE SLOTH HANSEN, HEAD OF COMMODITY STRATEGY “Bear markets do not end on good news. They bottom when they stop going down on bad news”

2. SAXO BANK FACTS 2 EMPLOYEES >1500 NATIONALITIES 59 SPOKEN LANGUAGES IN THE BANK 40 OFFICES 25 countries NO. OF FX TRADES PER DAY 170,000 DAILY AVERAGE TURNOVER 12 billion USD NO. OF COUNTRIES WITH RETAIL CLIENTS 180 SAXOTRADER LANGUAGES 25 FINANCIAL INSTRUMENTS +30,000 across 4 asset classes RECEIVED PRICES PER DAY 5-6 billions

3. A low price is the best cure for a low price 3

4. Also supported by the weaker dollar (until recently) 4

5. Strong year-to-date gains led by precious metals and grains 5

6. Attracting renewed demand from speculative traders 6

7. Crude oil: Recent history 7

8. Crude oil recovery: First verbal intervention 8

9. Followed by US production slowdown 9

10. And now supply disruptions 10 Rebalancing accelerated during the past month Millions of barrels currently removed due to involuntary supply disruptions Global demand growth remain robust

11. Too much – too soon ? 11 Calendar-17 approaching $52/bbl Contango being driven lower from speculative buying at the front and increased hedge selling at the back Shippers now borrowing money to keep oil at sea: No buyers or hoping for higher prices in the future

12. US shale oil stocks have rallied with credit risk collapsing 12 US shale oil company stocks have rallied As credit conditions have seen a sharp improvement

13. US production will eventually recover as oil price recovers 13 Global oil discoveries have to fallen to a six-decade low (Rystad Energy) An estimated 77 companies gone bankrupt since early 2015 with another 175 drillers around the world at risk of going under (Deloitte) We may need shale oil to come back already in 2017 to fill the gap left open by the multi-billion dollar reduction in Capex The price need to recover and stabilize above $50 per barrel so pumpers and drillers can mobilize completion and rehire rig crews. More than 4,000 drilled but uncompleted oil wells (DUCs) waiting for higher prices

14. GCC members preparing to defend its market share 14 Saudi Arabia and its local allies preparing to take advantage of a looming supply crunch Gulf states are planning to raise output capacity to fill the hole left by the lack of investment in new projects elsewhere The worldwide rig count hit its lowest level since September 1999 Saudi Arabia, Kuwait and UAE the exception with near record drilling rates. Looking to raise production by at least 3.5M bpd by 2020

15. Funds are betting heavy on higher prices 15

16. US weekly inventories, production and demand data 16

17. Outlook for crude oil: 45-50 range for now, 50-55 at year-end 17 Tighter balance implies higher prices Temporary supply disruptions becoming longer lasting (Nigeria, Libya & Venezuela) Geopolitical instability increases in key exporting countries Strong momentum from fund positioning carrying it higher Increased focus on Capex cuts and impact on future production US production slowdown reverses High inventories persist in most storage places Iranian and Saudi Arabian market share battle triggering higher production from both Summer driving season in Europe and North America disappoint leaving gasoline inventories elevated Chinese demand slows as strategic reserve facilities fill up Stronger pace of US rate hikes triggering renewed dollar strength

18. 18 Brent crude rising within an 8 dollar channel Expecting to find resistance above $50 triggering a return to $45 before rally resuming Year-end should see the price trade close to $55 Source: SaxoTraderGO

19. June Opec meeting: A few thoughts 19 June meeting has become increasingly irrelevant – No decisions required Having done nothing (apart from verbal intervention) the focus has shifted to US production slowdown and major supply disruptions Focus on new KSA oil minister. Will hardline approach from Doha be repeated? Rebuilding the cartels reputation should be a priority. Whether they succeed or not will determine the potential impact on the market

20. Gold: Challenged but key driver remains 20 Trillions of dollars of secure government debt trading at very low or negative yields Negative interest rate policies have driven money managers voluntary or involuntary to search for alternative investments Gold’s diversification properties remain a top priority for central banks amid financial market turbulence (WGC)

21. The biggest investment surge on record 21 Total holdings in exchange-traded products up by 25% or 364t y-t-d Demand has continued this month without the support from further price appreciation

22. The “smart” money has returned with a vengeance 22 Hedge funds have been almost non-stop buyers after beginning the year with a record net- short position Recent sell-off has removed longs established at the beginning of May

23. Strong “paper” demand offsetting weak jewellery demand 23 ETP and futures demand rose by 800t during Q1 and currently up 930t y-t-d Paper demand overwhelming the 115t decline in jewellery during Q1

24. What are the producers and merchants telling us? 24 Gross-short reduced by 42% in three weeks with the net-long more than doubling Unusual to see natural hedgers (sellers) going aggressively long

25. Other important drivers: Dollar and bond yields 25 Rising inflation expectations may sway the US FOMC to act more aggressively on rates Causing temporary headwinds through a stronger dollar

26. Gold miners: A leveraged play 26 Increased profitability from lower wage costs (in local currency) and falling diesel prices Efficiency drive following years of declining prices driven cost per produced ounce down by one-third since 2012 (BBG) Higher prices triggering a wave of debt reduction left over from the “bad” years One ton of material produces 1.25 gram of gold compared with 0.88 gram in 2012 Major Miners Junior Miners XAUUSD Source: Bloomberg

27. Silver playing catch-up after breaking downtrend vs gold 27 Increased industrial demand: mobile phones, flat-panel TVs and solar panels Silver is a high beta gold => more volatile as lower liquidity triggering bigger movements Hedge funds holding a near record long silver position XAUXAG ratio broken the uptrend in place since 2011, long-term ratio average some 20% away at 60 A gold break above $1300 to trigger renewed silver outperformance with ratio targeting 65

28. Outlook for gold: Challenged now but expect rally to resume 28 Central banks, other than FOMC, keeping monetary policies super loose => negative bond yields Rising inflation as the base effect of the oil price-slump fades Equity market turmoil supporting gold from its non-correlation Stronger pace of US rate hikes triggering renewed dollar strength Global economic growth picking up reducing demand for insurance A rapid accumulation of gold triggering a deeper than expected correction June and July seasonally weak periods for demand before the late Q3 pick-up

29. 29 Pro-trend correction targeting $1205/oz with a deeper move to $1175/oz also OK A return to $1145/oz will signal a return to the drawing board for fresh guidance Expect rally to resume with a break above $1305/oz targeting $1380/oz Source: SaxoTraderGO

30. SAXO BANK A/S: NON-INDEPENDENT INVESTMENT RESEARCH DISCLAIMER 30 This investment research has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Further it is not subject to any prohibition on dealing ahead of the dissemination of investment research. Saxo Bank, its affiliates or staff, may perform services for, solicit business from, hold long or short positions in, or otherwise be interested in the investments (including derivatives), of any issuer mentioned herein. None of the information contained herein constitutes an offer (or solicitation of an offer) to buy or sell any currency, product or financial instrument, to make any investment, or to participate in any particular trading strategy. This material is produced for marketing and/or informational purposes only and Saxo Bank A/S and its owners, subsidiaries and affiliates whether acting directly or through branch offices (“Saxo Bank”) make no representation or warranty, and assume no liability, for the accuracy or completeness of the information provided herein. In providing this material Saxo Bank has not taken into account any particular recipient’s investment objectives, special investment goals, financial situation, and specific needs and demands and nothing herein is intended as a recommendation for any recipient to invest or divest in a particular manner and Saxo Bank assumes no liability for any recipient sustaining a loss from trading in accordance with a perceived recommendation. All investments entail a risk and may result in both profits and losses. In particular investments in leveraged products, such as but not limited to foreign exchange, derivatives and commodities can be very speculative and profits and losses may fluctuate both violently and rapidly. Speculative trading is not suitable for all investors and all recipients should carefully consider their financial situation and consult financial advisor(s) in order to understand the risks involved and ensure the suitability of the situation prior to making any investment, divestment or entering into any transaction. Any mentioning herein, if any, of any risk may not be, and should not be considered to be, neither a comprehensive disclosure or risks nor a comprehensive description such risks. Any expression of opinion may be personal to the author and may not reflect the opinion of Saxo Bank and all expressions of opinion are subject to change without notice (neither prior nor subsequent). This communication refers to past performance. Past performance is not a reliable indicator of future performance. Indications of past performance displayed on this communication will not necessarily be repeated in the future. No representation is being made that any investment will or is likely to achieve profits or losses similar to those achieved in the past, or that significant losses will be avoided. Statements contained on this communication that are not historical facts and which may be simulated past performance or future performance data are based on current expectations, estimates, projections, opinions and beliefs of the Saxo Bank Group. Such statements involve known and unknown risks, uncertainties and other factors, and undue reliance should not be placed thereon. Additionally, this communication may contain ‘forward-looking statements’. Actual events or results or actual performance may differ materially from those reflected or contemplated in such forward-looking statements. This material is confidential and should not be copied, distributed, published or reproduced in whole or in part or disclosed by recipients to any other person. Any information or opinions in this material are not intended for distribution to, or use by, any person in any jurisdiction or country where such distribution or use would be unlawful. The information in this document is not directed at or intended for “US Persons” within the meaning of the United States Securities Act of 1993, as amended and the United States Securities Exchange Act of 1934, as amended. This disclaimer is subject to Saxo Bank’s Full Disclaimer available at: http://ae.saxobank.com/legal/disclaimer www.saxobank.ae · Saxo Bank A/S · Philip Heymans Allé 15 · 2900 Hellerup · Denmark · Telephone: +45 39 77 40 00, E-mail: me-private@saxobank.com Dubai, Currency House, 1st Floor, DIFC, P.O. Box:506830, Dubai, United Arab Emirates, Phone: +971 4 381 6000, Fax: +971 4 325 9209, E-mail: dubai@saxobank.com Abu Dhabi, Etihad Towers, Tower no. 3, Unit 1401, P.O. Box: 43082, Abu Dhabi, United Arab Emirates, Phone: +971 2 408 8000, Fax: +971 2 658 3400, E-mail: abudhabi@saxobank.com

31. THANK YOU FOR YOUR TIME 31 @Ole_S_Hansen www.tradingfloor.com

32. Jordan growth developments 32 Regional instability constraining consumer and business confidence Large infrastructure and tourism projects should boost employment Inward investment from traditional Gulf investors and expats strained by impact of low oil prices Oil import bill will pick up again but so should potash revenue

33. Jordan price developments 33 Deflation expected to be reversed on the back of domestic demand growth, modest rise in international food and energy prices (most of which are met by imports) The dollar peg impacting import prices (Strong dollar limiting upward pressure) Housing rental prices to feel the impact of the refugee influx