BHP Billiton Ltd., the world’s biggest mining company, sees early signs that commodity markets are rebalancing, with oil and natural gas best placed to deliver gains into 2018. “Fundamentals suggest both oil and gas markets will improve over the next 12 to 18 months,” Chief Executive Officer Andrew Mackenzie said Wednesday in a statement. “Iron ore and metallurgical coal prices have been stronger than expected, although we continue to expect supply to grow more quickly than demand in the near term.” BHP joins Rio Tinto Group in expressing increased optimism on the outlook for commodities amid continued strong demand in China, the top consumer. Raw materials will probably see a broad-based recovery in 2017 after an expected strong performance in the final quarter of this year on improving demand, according to Barclays Plc. With long-life assets in oil, iron ore and copper, BHP is well positioned to benefit as markets rebalance, said David Lennox, a resources analyst at Fat Prophets in Sydney. Higher oil prices would also help to offset forecast lower volumes in fiscal 2017 in the petroleum division, he said. BHP declined 1.5 percent to A$22.30 at 10:46 a.m. in Sydney trading, trimming its advance this year to 25 percent. OPEC Oil has advanced about 14 percent since the Organization of Petroleum Exporting Countries last month agreed the outline of a deal that would cut production for the first time in eight years, while the Bloomberg Commodity Index, a gauge of returns on 22 raw materials, has surged about 85 percent since it touched an almost 13-year low in January. BHP’s petroleum and iron ore output in the three months ended Sept. 30 beat analyst estimates, even as both units posted declines on the same period a year earlier. Copper output declined 6 percent to miss estimates on lower grades at Chile’s Escondida and amid maintenance work and a power outage at Australia’s Olympic Dam. Full-year copper guidance of 1.66 million tons is under review following the power cut, the company said. Long-Life With large long-life mines, BHP “can increase production when it sees the opportunity to do so,” Fat Prophets’ Lennox said. “When they see the next upswing you can expect capital to go back in to those assets.” BHP maintained full-year guidance for petroleum output of between 200 million and 210 million million barrels of oil equivalent and for total iron ore production in Western Australia of between 265 million and 275 million tons. BHP’s iron ore production in the three months ended Sept. 30 fell 6 percent to 57.6 million metric tons amid a halt to output at Brazil’s Samarco joint venture following November’s deadly tailings dam spill, a rail maintenance program in Australia and lower volumes at the Yandi mine. That compares with 61.3 million tons a year earlier, which included output from Samarco, and beat the 56.6 million tons median estimate of five analysts surveyed by Bloomberg.