Economists Uncut

David Lin (Uncut) 01-20-2025

New sanctions have been announced on Russia by the Biden administration this week. This affects us all because oil moved on the news and oil, of course, is an energy input, for cost input rather, for pretty much everything that we have in society. And so talking about the direction of oil is important when predicting macroeconomic trends.

Helping us discuss this theme is Paul Sankey, president of Sankey Research. Welcome back to the show, Paul, happy new year. Good to see you.

Happy new year, David. Let’s start by talking about recent news. So if you take a look at my screen here from Reuters, tougher US sanctions to curb Russian oil supply to China and India.

Chinese and Indian refiners will source more oil from the Middle East, Africa and the Americas, boosting prices and freight costs as new US sanctions on Russian producers and ships curb supplies to Moscow’s top customers. The US treasury on Friday imposed sanctions on Russian oil producers, Gazcom, and I can’t properly pronounce this, but- Smoking, I have to guess. Yeah, as well as 183 vessels that have shipped Russian oil.

Anyway, how are you interpreting this news? And we will talk about the impact on the broader oil market. Oil did move up on the news. And of course, as you know, oil has been surging in the last couple of weeks.

So is oil moving on this or something else? Let’s start with that. No, I think this is the biggest single item that’s been out there. The other obvious thing is freezing weather.

So you’ve had a decent polar vortex into the US. Europe has also been pulling down natural gas inventories pretty rapidly from early in withdrawal season. So winter started early over there, at least heating season did.

But this is the big one, because this was kind of a surprise. In fact, it was a surprise. As you know, it’s the outgoing Biden presidency.

It’s not obvious exactly what’s going on over there because they’re doing some things which are clearly unhelpful to Trump or even anti-Trump. But at the same time, these sanctions were really, I guess, a pro-Ukraine move in order to put greater pressure on Russia. And they do serve to do that.

One of the key items here is gonna be the insurance companies that are insuring the shadow fleet. So the whole thing here has been that there’s been a blind eye turn towards Russian oil exports in order to facilitate lower oil prices globally. That’s obviously been highly hypocritical and has ended up with a lot of Russian oil going to India and to China, smuggled by a shadow fleet.

And these sanctions are gonna crack down on the insurance companies that are backing the shadow fleet and nobody wants to move $300, $200 million worth of crude in a tanker that’s not insured. So there’s immediately been some disruption to the market as a result of this announcement, absolutely. And furthermore, we think it plays into Trump’s hands insofar as Donald can do what he wants with these sanctions, but they’re an additional negotiating position for him to take.

People have calculated some numbers here. These sanctions will significantly reduce the fleet of ships available to deliver crude from Russia the short term, pushing freight rates higher, says an analyst. A Singapore-based trader said the designated tanker shipped close to 900,000 barrels per day of Russian crude to China over the last 12 months.

It’s going to drop off a cliff, he said. So is this gonna cause an energy supply crisis if this were to get worse? No, I think it’s just tightening the market a lot. I don’t think it’s a crisis as such because all the routes here are so disrupted anyway.

So basically, a lot of this Russian oil would never be going to India or China. It’s so far away. They would just send it into Europe.

But of course, with the sanctions that you’re getting because of the Russian invasion of Ukraine, they were smuggling effectively, ignoring sanctions and taking the oil all the way around to India and to China. The other aspects of Chinese supply has been Iran and that supply has been disrupted. And when you combine that with the cold winter, this is what the oil market needed.

The oil market was just looking softer and softer. Saudi’s grip was loosening on the market. And as a result, prices were under steady downward pressure.

Because of cold winter, because of these sanctions, we’ve cheered up an awful lot about oil. And with Saudi committed essentially to keeping volumes flat through basically May, we can see the market tightening up nicely here in the first half of the year. So we came into the year bullish oil actually, which is a change for us.

And that’s what you’re talking about is the key reasoning behind that, yeah. And we’re talking about oil, not just because, well, I appreciate that not everybody watching this is probably an oil futures trader, but like I mentioned at the beginning, the input cost affects us all. At what point, Paul, we’re at $76 a barrel, at what point does oil become a problem for the economy such that the Fed is going to have to really curb monetary easing, such that consumer spending is gonna wane, such that economic growth will start to feel a negative impact because oil is too high? Are we there yet? No, not really because the nationwide pump price that you’re looking for, which is when the alarm bells go off in Washington is about $4 nationwide at the pump per gallon, and you’re at more like 350.

So there’s a good 20% upside here before the alarm bells start going off. Furthermore, you still have that spare capacity in Saudi and generally in OPEC. So the upside risk here is quite limited by the potential for any further crisis to cause more supply to be given up by OPEC.

The balance that you have here is that you’ve got a nicely tightening market, low inventories. You’ve got potential for maybe a little bit of upside against expectations in China this year. And on top of all that, you’ve then got Saudi really wanting to squeeze the price higher.

When they’re satisfied with the price, which I think will be around 85, then I can see the Saudis deciding to supply more oil into the market. But a lot of that is going to depend on a couple of enormous unknowns at this point, which is what happens with Donald Trump in the White House. And there’s a lot of counter-currents there in terms of potential tariffs on oil.

That seems to be the latest chat coming out of Canada, that actually Canadian oil would be subject to tariffs, which would completely disrupt mid-com US refining, for example. And then on the other hand, of course, the expectation now that Russia, Ukraine, not least because of these Biden sanctions, is probably a situation that’s not gonna be dealt with on day one, which was one theory at one point. Now you can see that situation being a negotiating story for a lot of this year.

So we’ll see what happens there. Just a couple of things there that make it difficult to second guess what happens with Trump. And of course, then you’ve also got the potential for an agreement, for example, to hammer down on Iran exports, potentially Russian exports, and then let Saudi produce more oil, which feels like it could be what the overarching agreement is here.

We’ll see. Donald Trump has said on the campaign trail that he wants lower gas prices at the pump. Is that going to happen? Will he succeed? Not with drill baby drill.

I mean, I think everybody in oil is sort of rolling their eyes about stupid drill baby drill. Say, who’s the baby? Which one of you guys is a baby? But no, the general concept. And also the Biden, I had some excitement last week from the media.

I get these radio stations, these conservative radio stations in the mid-con phone me up and ask me to start commenting on the latest outrage perpetrated by the Democrats or Republicans for that matter. And the latest one was this banning of offshore drilling, huge waves of offshore being banned. But of course, it’s just completely irrelevant to what the oil companies are actually doing, which is drilling on private lands onshore.

So a lot of this stuff is somewhat nonsensical. And the whole drill baby drill concept is very much in that category of being something that you really can’t force on the companies who are reluctant to spend more money. Okay.

There are two forces here at play. The sanctions that could push up prices higher and the drill baby drill mantra, which is to produce more oil. I believe that on the tune of 3 million per day if Scott Pesent’s planned additional 3 million barrels per day, which force will win out? Because one is deflationary, one is inflationary for oil.

Yeah, I mean, on the one hand, I felt like his three threes was like, reduce the deficit from 6% to 3%, increase economic growth to 3%, which is not a mile away from where it is already. And then he kind of needed another three. And so he came out with 3 million barrels a day of oil equivalent, notice oil equivalent of incremental production in US energy, which, again, it just doesn’t show a very good understanding of the market.

I mean, it’s not clear what you could do to actually make the companies drill more given that their activities on private land. Conceivably, I guess you could cut taxes or something, but it’s just not obvious and corporate level tax is not gonna make a whole lot of difference to their drilling plans either. So essentially the group of drillers is not interested particularly in drilling more.

And so the question then becomes, is there gonna be other measures? And of course, tariffs are not on balance gonna help things. In fact, they’re gonna confuse everything mightily because potentially you’re gonna cut off a major source of cheap oil for the US, which obviously comes from Canada. Now, potentially you’re also gonna disrupt your own exports, which are a big deal in oil and gas.

So we’ll see how much of this actually comes to pass. At face value, it’s very worrying. And I think the market is concerned.

The bigger issue, and by that I mean the wider market, you can see from the NASDAQ that I think there’s quite a lot of fear growing into the market here as we get closer and closer to the reality of Trump too. Let’s go back to the oil price. The crude oil price has moved up about 13% since the beginning of December, 13, 15%.

Would another 15% move from current levels upward have a significant impact on CPI overall? Not just core CPI, sorry, not just headline CPI because that includes energy, but core CPI, excluding energy. Would it feed into the other sectors of the economy? It does eventually, but as you know, it’s not as big an element of CPI as people fear. And the real issue is shelter, right? And property and housing.

And of course, higher oil prices do somewhat feed through to that, but it’s pretty tenuous. So you’ll see that, yeah, there’s been some major supply chain issues with the Russia-Ukraine problems that definitely caused additional inflation in the US. But broadly speaking, especially not with gasoline prices where they are today, you may see some mild upward pressure on CPI from oil, definitely, and the market may well be worrying about that.

But ultimately, it’s not as big an issue as some of the other things out there, such as shelter, which really are a big deal. And as far as I know, I keep an eye on New York rental prices. Those rental prices are still hitting record highs right now in New York.

I can never quite understand how or why the rents are so high. But there are people out there who are more than willing to pay, quite clearly. So then bottom line, your outlook for crude oil for 2025.

Will it stay range-bound or are you expecting it to move a lot more? I think that what we’ll do is we’ll squeeze it into driving season. So normally we like to be long oil from, it’s pretty pathetic because it’s just a seasonal trade, but it kind of works. You’re basically long oil from around January right into driving season.

And then you tend to see the peak for the year around May, June. So we’ll be riding that. And can we get to 85? One of the interesting data points that a CFO of a major oil sent me from the Goldman Sachs Energy Conference last week was that not one respondent to their survey that they gave to the thousands of people who were at the conference, not one thought that oil would end the year above $85 a barrel, nor gas below $3 per MCF.

And so his obvious instinct was not one, not just like very few, but actually not one thought that, which is kind of amazing. So it does give you reason to want to be somewhat bullish here, especially as the mood turns so bearish towards the end of the year. And we were in that boat.

The upside surprise would have to be China, which is not out of the question. They are gonna probably throw the whole bag in on stimulus and we’ll see what happens there. Also, I think a lot of the market share that’s been taken away from oil by LNG trucks is probably not gonna continue at the same pace because the price of LNG is now high relative to oil and China.

So I can get a little bit more optimistic on China. India should show up okay. Europe’s gonna do nothing.

And US is kind of okay. I think most people think the economy is still going pretty strong here. So all of that gets you probably to half a million to a million barrels a day of oil demand growth.

And that, all things being equal, should allow Saudi some room to increase mid-year, which is what’s gonna cap the price out. So let’s put in a price target of 85 by May and then we’ll probably be going neutral to negative from June onwards. This is the Saudi spare capacity that comes back into the market.

Any changes to production from some Western-based companies? I think you recently had some meetings with some executives, high-level executives of Chevron and others. Have they indicated to you their plans for production going forward into the Trump administration? Yeah, there’s a couple of things. So firstly, the US production dynamics have been the most important thing in global oil on the supply side by far over the past 15 years.

So the US went from, you know, well under five million barrels a day of production to 13 million barrels a day of production, an incredible shift at the margin, and has gone now, I think, a fourth straight year of being the biggest oil and gas producing country in the history of the world ever. So the US has completely reached the pinnacle here of production success. And that’s been huge for the economy and it’s been huge for the dollar.

It’s also oversupplied the market, arguably. Combined with OPEC’s willingness to exert discipline and Saudi’s willingness not to produce all out, you’ve had an artificially high price of oil as OPEC has held capacity off the market. Now, the way that you’re gonna tighten that capacity, one of the key areas obviously has to be whether the US continues to grow its production, whether it holds flat or whether it declines.

And towards the end of last year, we had meetings with Chevron, where Chevron actually cut their CapEx guidance for 2025 and said they’re going to plateau mode in the Permian. And as one of the leading producers in the Texas Permian, that was sort of important because it tells you that we’re beginning to run out of steam in the Permian after really 10 straight years of incredible growth. It just derailed a little bit by COVID.

And so by the same token, if Chevron’s going into plateau, it implies that the rest of the industry is gonna go into decline, and that implies that we’re gonna turn the oil market and we’ll have declining productivity, which is what you’re looking for to drive prices higher. That’s on the one hand. On the other hand, Exxon had their analyst meeting in December at their huge headquarters in Houston, and essentially they reaffirmed very strong growth, partly because they’re very advantaged.

They’ve got a major new position in the Permian from having bought Pioneer, and they’ve got the phenomenal position in Guyana, and the two together means they’re gonna be growing aggressively through 2030. And that presents a problem for oil bulls and a problem for Saudi, because essentially Exxon is kind of single-handedly taking their market share quite aggressively. And if you look at Saudi exports of oil into the US over the years, they’ve hit all-time record lows, not least because one of their biggest customers used to be Exxon, and Exxon now 100% supplies itself from its own Permian production.

So there’s sort of conflicting views coming out of the two major companies in the Permian. Others, like Conoco, are still gonna grow. Others, like Diamondback, are in a very low-growth mode.

Broadly speaking, it looks neutral at this stage. I can’t come out with a super bullish, super bearish conclusion either way, because essentially you’re plateauing, and what we’re waiting for is when we go into decline and it’s being bullish, which looks like it’ll be a post-26 type timeframe. Well, how do you think they’re gonna work with the new administration to meet the new administration’s production objectives or targets? Because the government is not, for the most part, doing the drilling, it’s a private entity.

So how is Scott Bissett going to incentivize Chevron and others to meet their additional three million barrels a day? Well, they certainly aren’t telling. I mean, we’ve heard absolutely nothing from Trump nor Bessner about the specifics of exactly what is entailed in this sort of drill-baby-drill plan. There’s just no specifics.

On the other side, the more specific stuff that you’re hearing is Trump reducing subsidies to EVs, some stuff that’s bullish oil on the demand side, reducing cafe standards, trying to prevent California from pursuing zero ICE sales by 2035. The list of stuff that is fairly specific is quite long, but as for drill-baby-drill, there really is no indication of how that would work. One thing you could do, obviously, is if you put in tariffs, for example, on carbon tariff even, if you just said, okay, everyone who wants to import oil into the US is gonna have to pay a 30% tariff.

Obviously, what you would do is raise domestic US oil prices, and that would encourage more drilling. And you could get there that way. But of course, it also shows you just how much inflation you’re gonna generate by a major tariff program, which is what Wall Street’s very worried about and which the administration doesn’t seem particularly worried about, which is a definite dichotomy between the way the street is looking at this stuff and the way we are.

And the other thing is this year is gonna be tax, so watch out for tax, because that’s gonna increase deficit concerns, which are probably gonna be negative for the market as well. So basically, we’re pretty negative the market here, but bullish oil within that construct, which is a little bit different from what most people are saying, as far as I can tell. Are you, how do you feel sentiment-wise about the oil companies, not the oil sector, not the oil price itself, but the oil companies this year? Midstream’s been very good.

So the business of just moving the stuff around the US is an excellent business, and we love the natural gas to AI theme. So we’ve been big in things like Constellation and Vistra, which have done very, very well and continue to do well. All of them had great trading today, for example.

So that natural gas to AI theme for us is a mega theme that we’re just gonna keep riding. We like Kinder on that theme as well. So the midstream guys all look good.

The one that’s been beaten up, not as much perhaps as might be expected, given margins, but which has still been beaten up, has been refining. And we came through our recent refining conference, which was this past week, including that actually things are quite a lot better in refining and in oil markets than perhaps had been the mood ending 2024. And so we’re looking for a major refining shutdown at Lyondell in Houston, and later in the year at PSX in LA, both to tighten the refining market.

And we’re looking for a decent demand story here with more Saudi barrels to be good for some of the more levered refiners. So we like Dellec and PVF. Don’t really like the services apart from Baker Hughes, which is for us a stealth play on AI because of their turbine business.

And we like turbines, so we like Baker Hughes, but the other two, less interested with Schlumberger reporting shortly is the beginning of the US oil reporting season. And then amongst the big guys, they’re actually in good shape. Exxon is in really good shape.

Chevron should get a good decision, we think, from Exxon over the Hess dispute this year, so they’ll be fine. These major companies are in good shape and they look so much better than the Europeans who are basically in disarray. But of course they’ve massively outperformed.

And if you wanna buy some real junk in order to make the most of a bull call in oil, something like BP is heavily beaten down. We don’t like the management, we don’t like the strategy, but it is very levered. So if you’re gonna get along these things, you tend to go for things like refining and beating down big oils like Devon as a way of playing what could be a correct call on oil.

You get oil wrong, you’re gonna be very wrong on those stocks, so be warned. Okay, and one- And we can be very wrong on oil, believe me. Yeah, I certainly, I’ve had experience with that myself.

But this is why you’re the expert and not me. But Paul, there’s one more risk that we haven’t discussed yet, which is the possibility of Canada cutting off energy exports to the US in response to Trump’s 25% tariffs on Canadian goods. Take a listen, well, first it was Doug Ford, Premier of Ontario, and then now Melanie Jolie, who is the Foreign Affairs Minister, is saying the same thing.

On the news, just take a listen to the first minute of this conversation. So if these tariffs are applied, as he has threatened them to be, which we don’t know the case, he hasn’t announced the specifics, but he’s saying 25%. I was interviewing six economists, the top six economists, the chief ones, for all the big banks the other day.

And collectively, they said the hit to the economy, we’re looking to the tunes of millions of jobs, you’re looking at a 3% contraction and essentially an immediate recession. So it’s in that vein, against that backdrop, I ask you about what retaliation would look like. Is your government prepared to cut off supplies of energy, for example, to the United States? What I can tell you is everything is on the table.

And that’s the conversation we will have, the Prime Minister, Minister LeBlanc and myself, with the premiers next week. And that’s the conversation also I’ll take to Republican senators and key Republican decision makers in Washington next week. Because this is indeed a decision that would be taken by President-elect Trump that would have devastating impacts on Canadians.

Does this matter, is my question. If Canada were to go ahead with this. It’s the US biggest source of foreign oil, right? If you want to consider it foreign oil.

And it is a very big deal. I mean, it’s sort of snowballing kind of out of control. And it’s not, because you’re in this limbo of who’s actually in charge, it’s very difficult.

You know, Trump’s not the president, right? And all this stuff is sort of under negotiation quite openly. And, you know, I think it’s actually shocking. You know, I think people are definitely surprised at the idea that we would get into a trade war with Canada over energy.

As you know, the initial reports were, you know, people were sort of, oh, don’t worry, it’s just a negotiating position. And then it was like, oh, don’t worry, it won’t include energy. And actually, it’s gone exactly the opposite direction, right? He’s doubled and tripled down on the threats.

He’s gone towards energy, not away from it. And he’s getting closer and closer to being president. So, I mean, it’s gonna be wild.

You know, we’re gonna see what happens with all this stuff. But it worries me because I’m very anti-tariff, right? I’m a kind of classic, if you want, classically trained Manchester University School of Economics. Free trade is good, you know? And so these tariffs, which distort everything so much, and then the subsequent exemptions that really only benefit lobbyists, it’s gonna be a wild ride.

And we call it a pinball market, David. I mean, what we’re expecting with Trump is these pinball tape bombs, you know, where you wake up and you read that such and such has been gonna be banned, or Elon’s gonna play TikTok, or, you know, whatever else the give and take bomb is. We’ve already had several in energy.

The other thing is, obviously, there’s the potential for major acquisitions and mergers, such as you just saw with Constellation buying Calpine, announcing a deal for Calpine, which was dramatic in the utility space. So you can maybe see a major oil deal. You know, maybe we’ll see Chevron buying Conoco, or Exxon buying Oxy, although I don’t think Vicky is a seller of Oxy.

You could see a couple of major deals that wouldn’t be pushed under the Democrats being pushed through under Trump. Look, this is Trump’s response. Here’s his 30-second response to this.

Out of them, we don’t need Canada for that. We don’t need Canada for lumber because we have big forests that we have, you know, not utilized. In some cases, they’re protected, which I can take that protection off.

And you take down a tree and you grow a better tree. That’s, you know, pretty common. But we don’t need anything.

We don’t need their fuel. We don’t need their energy. We don’t need their oil and gas.

We don’t need anything that they have. And I said to Trudeau, I said, why are we subsidizing you $200 and $250 billion a year? He said, I really don’t know. And I said, well, I don’t know either.

He’s not entirely right about the fact, look at this. According to the government of Canada, in 2020, Canada supplied the US with 98% of its natural gas imports, 93% of its electricity imports, and 28% of its uranium purchases. Canada supplied the US with 61% of its crude oil imports in 2021.

If, you know, I’m not saying it’s gonna happen, but let’s say some energy is cut off. Could the US find an alternative immediately? Yeah. No, I mean, one of the things is that those numbers appear very high because the overall numbers are not that high, if you know what I mean.

So the fact that Canada is supplying 98% of our natural gas or whatever is simply telling you that we’re actually exporting a lot of natural gas. So it’s really about the plumbing, David, over time. So the system is organized to bring Canadian energy into the North and to the mid-con of the US.

There’s a couple of refineries there that use Canadian heavy oil. You have the New York electricity system, as you can see there, is heavily dependent, amongst others, on Canadian hydro around the Great Lakes. All of that stuff would be massively upheaved if you were to just go along with the blanket tariffs.

But the fact of the matter is, what Trump says is not entirely wrong. You know, we are a major oil exporter now. And so by extension, we don’t necessarily need to import any oil.

It’s just a question of optimization of systems. That’s why, as a free trade advocate, you’d be like, it makes no sense to put tariffs on them because the system is optimized to take their oil and sell distillate to Europe. You know, that’s how the system works.

So you’re taking Canadian oil all the way down to the Gulf Coast. You’re making the gasoline and you’re shipping it to Europe. The system has been working for 20, 30 years.

And if you’re gonna suddenly change the price of everything, it’s gonna cause a lot of upheaval and a lot of inflation as you rework the system to get around the upheaval. And that’s what Wall Street’s worried about, is that a lot of this stuff is just a directly inflationary in the short term. In the long term, it probably makes the market distorted as well.

You know, if you have tariffs, you really shouldn’t have any tariffs on anything, in my view. So it’s gonna be a wild ride, man. And the other thing that we’ve been highlighting is that Trump has total power over foreign policy, right? The president really has a lot of power.

There’s two views on this. One is the Madisonian view, which is that Congress really should set foreign policy, which isn’t a widely held nor recent trend. The recent trend has been the Hamiltonian view, which is essentially the president has, you know, unilateral total power over foreign policy.

And as a result, you know, some of this stuff that you’re seeing with Trump and Greenland, which the Greenlanders could just vote for, or, for example, with Panama, you know, which has been a precedent. We have invaded Panama since, you know, in the last 50 years. We’ve invaded in 89.

You could see some wild stuff happening under the Monroe Doctrine, which was set by President Monroe, you know, 250 years ago, which says basically the U.S. has hegemony over the Americas against any foreign interference, which would imply going off to China in Latin America. So there’s a lot of dramatic stuff on the table here. Don’t underestimate it.

It’s crazy. It’s gonna be in a wild ride. And tensions in the Middle East, any impact, the American Navy attacked the Houthis a couple of weeks ago.

You know, any impact on the oil markets from the Middle East, you think? Well, I think our argument, David, had become that you couldn’t, you know, there was nothing, you hesitate to say this, but, or much less laugh about it. But the view was actually that there wasn’t a whole lot more that could go wrong in the Middle East. I mean, it was like, you know, give me, you know, you got, you’re back to civil war in Syria.

You’ve obviously got Iran has been reduced to being on its knees. I think the most interesting thing out there is probably Iran, because the Supreme Leader is now 85 years old and known to be sick. You know, I don’t know how well it’s gonna go when he appoints his son as the next Supreme Leader, who seems to be the favorite to take over.

There’s no credibility for the government. They’re economically very weak. And we’ll see what Trump does, but it looks very likely that he’s gonna put maximum pressure on them at a time when they’ve really ended up under a lot of pressure already particularly from Israel and particularly on the defense front.

They’ve just kind of had a terrible year and a half as Iran, following on from a terrible 30 years, in my opinion. So there’s that, that’s a very big one. Saudi is looking for a major deal with the US, which may involve cutting off Iranian oil, tightening sanctions on Russian oil, and then allowing Saudi to produce more oil.

And Saudi will produce more oil and stop the oil price going higher, as long as the US agrees a major defense pact along the lines of NATO with Saudi Arabia. So that would be that if anyone attacks Saudi Arabia, the US takes it as an attack on the US and responds accordingly. And that’s a big deal.

So you wanna watch that one. And of course, you’ve got the Abraham Accords, which have been successful in engendering peace in the Middle East, started under Trump. And we’ll see if we can get to a position where Saudi actually does go into diplomatic relations with Israel, which obviously would be a huge moment.

But at the moment, Saudi is requiring more or less the removal of Netanyahu and a two-state solution to Israel-Palestine. So that looks like it’s a long way off. But we’ve seen things move quickly in the Middle East over the past 10 years, they always do down there.

It’ll be interesting to see what happens under Trump in the region, given that he’s pro-Israel and pro-Saudi. So it’s an unusual setup to start with anyway. Interesting to watch.

Absolutely, well, thank you very much, Paul. Appreciate your analysis. Where can we learn more from you? Sankey Research is the website.

So it’s sankeyresearch.com. There’s a YouTube channel with a free weekly video, which people like. That’s on YouTube, Sankey Research YouTube channel. And if you really, really want to subscribe, you can get ahold of me through the website and actually receive the key product, which is about three or four emails a week of us wandering around the world of global energy and being thoroughly interested by doing that.

It’s a privilege to have this job because the world of energy is absolutely fascinating and very dynamic. And this whole AI theme has really put a whole new leg into global energy that’s really fascinating to follow. Thanks, David.

Appreciate your work, man. Yes, and thank you for your analysis. Thank you for your time.

And we’ll be back soon. Thank you for watching. Don’t forget to like and subscribe.

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