Today I’m excited to publish the first part of a podcast series on oil that I will be doing over the next couple weeks. Rob Connors, the author of
, joined me for part 1 to give us a historical look at where we are in the cycle today. He also provided a detailed slide deck that we went through, which I included below. If you want to follow him on Twitter, he also shares some of his interesting charts there.Podcast Summary
Why he thinks energy could be one of the best (if not the best) performing sector of the S&P 500 over the next decade, and could return 9-10% AFTER inflation.
The two main drivers for commodities cycles: liquidity or excessive money creation, and declining well productivity.
The six stages of the oil cycle, and why we are in stage 3 now.
How the incentive structures have changed for E&P management and what that means moving forward.
His thoughts on the political changes and why “Drill, baby, drill” won’t have a huge impact.
Why he thinks the floor for oil is somewhere in the low-60s.
Oil bull markets typically have three waves, and why offshore oilfield services typically perform best in the third wave.
His thoughts on the narrative around OPEC spare capacity, and why he is more focused on non-OPEC supply.
Book Recommendations: Can’t Deny It by Doug Terreson, The Prize by Daniel Yergin, and The Quest For Value by Bennett Stewart.
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