I was interviewed this past week on The Wall Street Shuffle and focused on energy.
The main theme focused on conclusions from the recent IEA Oil Market Report. This was the first year that the IEA discussed the fact that the world probably reached peak production of “conventional” oil in 2006 and that going forward the growth in oil production to meet demand will have to come from “unconventional” oil (ultra deep water drilling, natural gas alternatives, etc.) but that this growth will not make up for the dropoff in conventional production. Which obviously means that shortages are coming in the next few years, prices will remain high even as we go into another recession. Add to that geopolitical conflict and debasement of fiat currencies, and energy looks like it has potential to outperform going forward. I mentioned that i prefer the producers and explorers to the straight commodity for long term investors. Additionally, I prefer coal and nuclear energy companies to oil since I think massive investments will need to be made in those areas.
Related ETF’s: XLE, XES, NLR, KOL (I already have exposure to some of these areas through ETF’s and individual companies).