"Oil is high is because of geopolitics, and that is a variable...

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PaddyMac33

263 Posts.

33

19/07/22

13:54

Post #: 62608798
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Originally posted by 1ronnie: ↑

Paddy feels I am bias against Oil.

And yes, because high Oil price is a main source of our economic problems, it may well benefit Oil stocks but it can cause economic collapse and with it all oil stocks in the process as well. And the reason Oil is high is because of geopolitics, and that is a variable difficult to predict.

But the fact is my call already came right, oil entered bear market on recession narrative, but I did say recently I did not expect any fall further than $88-93 on the crude which so far is right. I also expected a second leg higher and this gas pipeline supply issue will likely be that catalyst. Now we awaits if Putin will go that far, Europe's gas represents 74% of Russia's supply but EU will be short of about 10% if Russia proceeds because most EU countries except Germany have enough gas stored. If Putin cuts supply, EU will be the first to enter recession.

Paddy wants to hold his oil stocks and I said good luck to him, sincerely. I am nothing against that, my rant on oil never stopped people buying oil stocks, people will trade how they like.

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"Oil is high is because of geopolitics, and that is a variable difficult to predict."

Nope it's because of under-investment in oil and gas projects over the last 10 years because of ESG governance whilst demand continues to grow, creating a supply/demand imbalance causing prices to rise.

An example of ESG governance

A chart to prove fossil fuel demand is continuing to increase.

[Source: EIA - International Energy Outlook 2021)
2 Upvote

0 Great analysis

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