Everyone pretty much agrees that we will—eventually, at least—transition from a fossil fuel-powered economy to one powered by less polluting energy sources.
However, as this energy transition gains speed, the risk of chaos emanating from it is rising. Here’s why…
Today, investment in new oil and gas supply is well below what it was a decade ago. And investment in clean energy, though accelerating, is not increasing as quickly as it needs to.
Fast forward to a few years in the future and that could translate to a very large mismatch between ever-rising energy demand and energy supplies. The end result would be a replay of what we saw in the aftermath of Russia’s invasion of Ukraine, with energy prices rising rapidly, forcing governments to help their citizens heat their homes and fuel their vehicles—but magnified by several times.
As investors, here’s how we position ourselves for this possibility…
Oil Companies Are Not Investing Enough
A great article from the Financial Times’ Energy Source newsletter explained that one main reason for this is simply that oil and gas companies are just not investing as much as needed into increasing future production.
Despite record profits last year, oil and gas companies globally invested about $310 billion into capital spending. This was far lower than…
Continue reading at INVESTORSALLEY.com
