Gemini said
In this video, Eric Nuttall of Ninepoint Partners outlines the fundamental case for a sustained multi-year bull market in oil and gas, arguing that the world is in an "energy expansion" rather than a transition [ 17:43].
The "Twilight" of US Shale- Production Peak: Nuttall argues that US shale production has reached its zenith, losing its status as the world's primary source of marginal supply growth [ 03:09].
- Impact of Decline: Without US shale, non-OPEC production would have fallen over the last decade. Its stagnation creates an imminent supply challenge as global demand continues to rise [ 04:05].
The Oil Supply Crisis- OPEC Capacity: While agencies like the IEA claim 8 million barrels of spare capacity, Nuttall estimates it is actually closer to 1.5 million barrels per day when excluding storage and focusing on actual wellhead productivity [ 06:46].
- Exaggerated Alternatives: He dismisses the idea of Venezuela filling the gap, citing catastrophic infrastructure decay, lack of rule of law, and a need for over $100 billion in investment [ 10:25].
- Long-Term Outlook: With demand growing through 2050 and non-OPEC supply peaking, Nuttall expects oil prices will eventually need to reach all-time highs to incentivize necessary offshore exploration and development [ 12:30].
Natural Gas & LNG- Structural Demand: The real bull case for natural gas is the massive structural increase in demand from Liquefied Natural Gas (LNG) as the world seeks to replace coal for power generation [ 14:21].
- Valuation: Nuttall views $4.00 as the marginal cost of supply. Even at this conservative price, natural gas stocks appear extremely undervalued [ 14:55].
Investment Sentiment & Strategy- Stealth Bull Market: Despite high performance, the energy sector remains "hated and despised" by institutional investors, with ownership levels at near all-time lows [ 00:40].
- Regional Preferences: * Oil: Prefers Canada due to massive reserves, rule of law, and strong dividend sustainability [ 16:17].
- Gas: Prefers the United States for its inventory and market position [ 16:17].
- Shareholder Returns: Because companies have largely abandoned "growth for growth's sake," they are now focused on maximizing free cash flow and buying back stock, which benefits long-term holders [ 05:41].
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Post-Shale Reality: The Case for a Multi-Year Oil & Gas Bull Market
Ninepoint Partners · 16K views
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