What makes you say 1. "can't expect to see oil at the current price". and 2 "if it does, there's bigger problems"
1. The facts point to substantial lack of long cycle conventional oil projects for the past 10 years. These are the low(er) decline (3-5% versus 20-25% in shale) type projects. Short cycle shale has hidden this lack of investment but shale cannot grow forever and even stay flat. This all points to oil prices staying well higher than the current $100 than lower.
2. The world economy did just fine with $100 avg oil prices from 2011-2013. Back then then the money supply was a lot lower and the economy's oil intensity was higher. Once you factor is both these we would need oil to be between $130-150 to have the same effect as $100 back 10 years ago. If the economy could sustain those prices we can sustain $130-150 now.
My guess is a lack of supply (even without the war) will cause oil to spike to $200, cause demand destruction (which is required due to lack of supply) and then balance supply/demand at the $130-150 range for the next 7-10 years.
Sangomar is starting up in 2023 to catch the sweet spot of the spike and hence will likely pay off in less than 2 years max. IRR of >50%
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