I was surprised to read the other day that sales of heat pumps across Europe dropped 47% in 1H24 versus a year earlier. The EU has adopted more aggressive policies to combat climate change than any other region. Residential adoption of heat pumps is part of their green agenda. We recently replaced an oil furnace […]
Revisions this year for the ten year growth outlook for US power demand because of AI data centers have provided support for midstream energy stocks, as additional natural gas will be needed (see The Coming Fight Over Powering AI). A recent report from Morgan Stanley (Global Clean Power – At a tipping point) expands this […]
The outlook for crude prices is a frequent conversation topic among energy investors. We’re often asked for our thoughts – over the next several years we’re bullish as growing demand from developing economies competes with insufficient investment in new supply. But we don’t trade oil or reflect that outlook in portfolio construction. Crude oil and […]
When a sector has enjoyed a period of good performance, the investor typically has to moderate her feelings of satisfaction at a choice well made with concerns about a crowded trade. When a good idea becomes widely acknowledged as one, prices are likely to overshoot as valuations become stretched. This does not seem to be […]
I spent two weeks recently touring southern England with my wife. It’s 42 years since I moved to the US, and I appreciate my old country more now than as a teenager itching to escape to the new world. We did some sightseeing and saw old friends. As we traveled around, the British approach to […]
If a single chart can illustrate the challenges in reducing emissions, it’s the scatterplot below showing per capita energy use and GDP. Raising living standards requires more energy. The relationship between these two variables is hard to break. Richer countries consume more energy, and becoming richer requires more energy. Everyone wants to move up and […]
It’s hard to overstate the global success of US natural gas production. Over the past decade we’ve grown output by 37 Billion Cubic Feet per Day (BCF/D), accounting for half the global increase. We now produce over a quarter of the world’s gas. And it’s cheap. The development of fracking happened in America not elsewhere […]
To be an energy investor is to consider the energy transition on a daily basis. You don’t even have to be certain that man-made global warming is happening. Simply accepting that it may be possible should still induce a prudent world into managing this risk. Climate is complicated, and certainty that increasing CO2 emissions will […]
Journalists love to write about fast growing renewables. It fits the narrative that solar and wind can eventually replace our traditional sources of energy. It allows the absence of any serious push towards nuclear power to go unanswered. It avoids the uncomfortable question of why China’s increasing emissions from coal are acceptable when in America […]
Germany’s energy transition, or “Energiewende” as they call it, is causing casualties. One is the Green Party, which did so badly in recent elections that it may not be represented in Thurungia’s regional legislature. More state elections are scheduled and there are concerns of further loss of support. The Greens are the main proponents of […]
