The recent decline in oil prices will have variable impacts on different types of commodities, says Fitch Ratings in a new report.

The rating agency says that open cast miners will likely benefit from the recent 25% drop in oil prices. However, it cautions that further declines for a prolonged period could have material impacts in the metals and mining or chemicals industries.

For instance, Fitch says that lower long-term oil prices could depress liquids-focused shale drilling, and the associated natural gas supply, which represents a large portion of North America’s total supply. “A decrease in the supply of associated natural gas in the U.S. may put upward pressure on natural gas prices in most regions and benefit coal miners as utilities switch electricity generation back from gas to coal,” it says.

The effect of lower oil prices on steel producers will likely be mixed, Fitch also says. “Higher natural gas prices would increase the cost of finished steel and less drilling could reduce demand for steel in the form of oil country tubular goods. This may be more than offset, however, by increases in demand for larger automobiles (autos are 12% of global steel demand) as long-term gasoline costs decline,” it says.

Similarly, aluminum is currently benefiting from a trend to lowering vehicle weights, which is being driven by high fuel costs and fuel economy standards, Fitch reports. “Should consumers shift toward larger vehicles, aluminum demand should also increase on larger size and the need to reduce the weight of bigger cars,” it says.

As for gold prices, they could be pressured by a prolonged dip in the price of oil, Fitch suggests. “Part of the demand for gold comes from inflationary expectations. Since energy prices are a sizable portion of inflation, a prolonged decline in energy prices could cause inflationary pressures to wane, leading to the demand for gold as an inflationary hedge falling as well,” it says.

Finally, Fitch says a pullback in U.S. shale production could lead to higher feedstock costs and lower margins for petrochemical companies.

The rating agency says that its base case long-term price assumption for West Texas Intermediate crude (WTI) remains at US$75 per barrel. Fitch does not anticipate a U.S. supply response until crude prices reach the US$70-US$75 range on a sustained basis.