As INO’s Energies contributor, how could I ignore Saudi Prince Alwaleed’s provocative statement that oil will “never” hit $100 “anymore”? In his interview with Maria Bartiromo for an article in Monday’s USA Today, Prince Alwaleed aptly summarized key reasons for today’s low oil prices, but (importantly) he didn’t give offer any evidence that oil would “never” again reach triple digits.
Still, many are decrying the “end of the oil supercycle.” Perhaps the supercycle is dead; or perhaps not. Either way, the world still needs energy from someplace, right? And lots of it! Which path, then, does the future hold? A resurrection of the oil supercycle? Or a reincarnation of a new energy supercycle based on resources other than oil? (Or “all of the above”?).
One prominent money management firm I’ve followed for most of my investment career, WHV Investments in San Francisco, was the first to introduce me to the term “supercycle” – referring to the coming oil- and steel-intensive “industrial revolution” that kicked into high gear in emerging countries in the early 2000s. By way of background, WHV is no “closet indexer.” Its managed portfolios, rather, reflect the firm’s conviction in top-down macroeconomic themes and trends identified by its team of analysts and managers. Continue reading "If the oil supercycle is dead, do you believe in resurrection? Or reincarnation?"