⚡ Global conflict era begins — energy and defense outperform

Friedberg energy w=0.78 · n=18 · E61 (2021-12-29) · positioning · strength 3 ▶ 1:03:30 SUPPORT · horizon 12mo

“I think we'll see the start of great global conflict... maybe something in the Ukraine, maybe something related to Taiwan... In a world of increased global conflict, assets that do really well are energy commodities and energy stocks. I recently made a big bet on energy stocks, defense stocks.”

Chamath energy w=0.55 · n=22 · E65 (2022-01-29) · sentiment · strength 2 ▶ 21:23 SUPPORT

“it turns out that, you know, the strongest power in Europe, Germany, is in a really difficult situation because they rely on Russian energy. ... And so when all of the saber rattling was happening, Germany basically had to blink because they need Russia's energy.”

Friedberg energy w=0.78 · n=18 · E66 (2022-02-05) · explicit_prediction · strength 3 ▶ 1:31:17 SUPPORT · horizon 11mo

“This is the beginning of the end of US cultural and economic influence globally, or dominance, rather influence globally. And I think that it's, you know, something that we've talked about quite a lot. You know, I mentioned in the prediction episode that I thought that Putin was going to play a major role this year. ... he's clearly not just, you know, out for his own interests, but he's going to play a really important role in China's rise to economic and cultural dominance.”

Chamath energy w=0.55 · n=22 · E66 (2022-02-05) · sentiment · strength 2 ▶ 1:31:07 SUPPORT

“I mean, you could have rewritten that press release as you know, we will, we want to try to destroy US hegemony and replace it with ourselves.”

Friedberg energy w=0.78 · n=18 · E67 (2022-02-12) · positioning · strength 3 ▶ 54:15 SUPPORT

“I mentioned to you guys at the end of last year that I made a bet on energy stocks. And the reason I made a bet on energy stocks is because some of the breakthroughs that we're seeing in decarbonization and renewable energy has driven a reduction in capital improvements across energy infrastructure. ... there's a lot of leverage that energy producers have over those that are the consumers, as we're seeing currently with the Russia, Ukraine, Europe crisis, and so on. ... And I do think that some of this global tension stuff we're seeing is only going to drive it up for a while.”

Chamath energy w=0.55 · n=22 · E67 (2022-02-12) · sentiment · strength 2 ▶ 56:33 OPPOSE

“we do have some constraint supply for the amount that we need to get back to the level of production we had pre-pandemic. So we are going to have some sustained energy prices. ... And so I'm not a big buyer of this trade, to be honest with you, Friedberg. I think that it works in the short term. I don't think it's an investment. I think at some point, you're going to have to make a decision about what your view on energy is.”

Friedberg energy w=0.78 · n=18 · E70 (2022-02-24) · positioning · strength 3 ▶ 22:46 SUPPORT

“So the reason I bought energy stocks in December, and the reason I made this point was threefold. One is because we have, as a result of this general consensus view, underinvested in energy infrastructure. And the demands that are going to come out of the ex-COVID economic growth cycle cannot be met with the current energy infrastructure. And you are going to see energy prices continue to climb, coupled with the fact that when war or conflict arises, typically you see stockpiling and you see trade routes being shut down and you see energy prices climb. ... even some of the energy companies that are going to benefit greatly from this commodity cycle we're kind of in the middle of”

Chamath energy w=0.55 · n=22 · E70 (2022-02-24) · sentiment · strength 2 ▶ 12:57 REVERSAL

“I have to be honest with you, when I was thinking about the odds of this, just from a financial perspective, and whether I should be doing something different or putting something on, I thought that there was zero chance that this would happen. Literally, I put it as close to zero as possible because I thought in 2022, it just didn't seem like this could be possible. And here we are, and it seems like it is.”

Sacks energy w=0.94 · n=16 · E71 (2022-03-05) · explicit_prediction · strength 2 ▶ 44:51 SUPPORT

“Yeah. I mean, look, I think it's so obvious now to everybody that we need to be energy independent, that it was insane for us to throw away that energy independence. We've restricted it. I think that if there was a bill introduced, I think it's being talked about to repeal all the restrictions on fracking, it would pass the Senate 7525, meaning all the Republicans would vote for and half the Democrats would vote for.”

Chamath energy w=0.55 · n=22 · E71 (2022-03-05) · explicit_prediction · strength 2 ▶ 32:39 SUPPORT

“Look at Germany as an example. Germany undid 40 years of policy. They had consistently been under investing relative to their GDP in the military, and they made an explicit commitment to basically just ramp that up back above 2%. They've also made commitments around their energy independence.”

Friedberg energy w=0.78 · n=18 · E72 (2022-03-19) · explicit_prediction · strength 2 ▶ 1:04:49 SUPPORT

“And this is why I predicted war at the end of last year”

Sacks energy w=0.94 · n=16 · E72 (2022-03-19) · explicit_prediction · strength 2 ▶ 44:54 SUPPORT

“We have a recession later this year as gas prices go to $7 and $10 a gallon. ... I think that turned out to be a great prediction. You got that one right.”

Chamath energy w=0.55 · n=22 · E72 (2022-03-19) · sentiment · strength 2 ▶ 33:00 SUPPORT

“we have a short-term bridge with hydrocarbons and the long-term solution is renewables ... We have to implement energy independence writ large.”

Brad Gerstner (regular guest ×1.0) energy: 2 resolved, unproven · E73 (2022-03-26) · explicit_prediction · strength 2 ▶ 1:10:43 SUPPORT

“I'm not betting this way with our book. But if I had to guess, we are going to have a period of significant escalation on both sides before they both get to the table. Macron said this week that we still have the Europeans have not made a decision about the embargo of Russian oil that will collapse the Russian economy. And oil will go to 180 or $200 a barrel. I think that's a real likelihood.”

Chamath energy w=0.55 · n=22 · E75 (2022-04-09) · sentiment · strength 2 ▶ 1:13:29 SUPPORT

“So energy independence, I think beyond anything else, strategic, probably an order of magnitude, it is the most important thing.”

Sacks energy w=0.94 · n=16 · E84 (2022-06-24) · explicit_prediction · strength 3 ▶ 1:22:39 SUPPORT

“That's coming, by the way. That's coming. You think things are bad right now, wait until winter, and then that's only going to increase Putin's leverage. And that's when you're going to see a real fracture in the Western alliance.”

Chamath energy w=0.55 · n=22 · E84 (2022-06-24) · explicit_prediction · strength 2 ▶ 21:24 SUPPORT

“Oil is at 105 bucks a barrel. Russia is basically trying to break the back of Europe by now messing with their Nat gas supplies.”

Chamath energy w=0.55 · n=22 · E85 (2022-06-30) · explicit_prediction · strength 3 ▶ 1:11:38 SUPPORT · horizon 6mo

“Russia is depriving Europe of Natgas. ... Where is the oil going to come from? OPEC is basically still stiff farming the United States with respect to expanded production capacity. ... You could have $180 a barrel oil by November, December when it's cold, not just here, but in continental Europe.”

Sacks energy w=0.94 · n=16 · E85 (2022-06-30) · sentiment · strength 2 ▶ 1:08:24 SUPPORT

“the third part of this is the overhang of this war in Europe, the Ukraine War, which is now threatening to become a forever war.”

Chamath energy w=0.55 · n=22 · E86 (2022-07-08) · explicit_prediction · strength 3 ▶ 45:33 SUPPORT

“They found that if Russia were to cut 3 million barrels of oil, so we would go from being oversupplied by 1 million to undersupplied by 2, the price of oil would go to about $180 a barrel. ... If they cut 5 million, so the threshold at which their economy doesn't really get that impacted, the price of oil could go as high as $380 a barrel. ... So Saudi Arabia says we can get to 12 million. Well, guess what? They can only start the work in 2024 They'll be done in 2027”

Sacks energy w=0.94 · n=16 · E86 (2022-07-08) · sentiment · strength 2 ▶ 1:13:47 SUPPORT

“And Biden baked this cake last year. We've discussed this before. He canceled energy independence, his first day in office ... if you knew a proxy war was coming or you're willing to let one happen, you would want to basically create an energy glut, not an energy shortage. You would want to basically maximize the amount of American production, and you would not want to alienate the Saudis.”

Chamath energy w=0.55 · n=22 · E89 (2022-07-29) · explicit_prediction · strength 2 ▶ 43:08 SUPPORT

“They have the perfect situation right now, which is it's an incredibly energy intensive world we live in, and we don't have nearly enough energy to do the work that needs to get done. And by the way, and you saw this this week already, where, you know, Putin cut Nord Stream by another 50%. It was already running at 40% capacity. He cut it down to 20%.”

Chamath energy w=0.55 · n=22 · E91 (2022-08-13) · explicit_prediction · strength 2 ▶ 44:46 SUPPORT · horizon 3mo

“But again, we're in the summer where we don't have the pressure on energy that we're going to have in October, November this year.”

Chamath energy w=0.55 · n=22 · E92 (2022-08-20) · explicit_prediction · strength 3 ▶ 53:43 SUPPORT

“Global productivity absorbs that. There is very little room right now to expand that without pushing the date in which that capacity is available out until, you know, 2028 to 2030 So effectively a decade from now.”

Sacks energy w=0.94 · n=16 · E92 (2022-08-20) · sentiment · strength 2 ▶ 48:48 SUPPORT

“And one of the reasons it didn't work is because simultaneously with declaring these allies to be enemies, he basically restricted US to energy production, which is strategically undermined.”

Chamath energy w=0.55 · n=22 · E95 (2022-09-10) · explicit_prediction · strength 3 ▶ 35:54 SUPPORT

“You may want to find the clip, Nick, from July, where I said the tip of the spear in the fall was going to be the European energy crisis.”

Chamath energy w=0.55 · n=22 · E97 (2022-09-23) · positioning · strength 2 ▶ 10:04 SUPPORT

“I think there's some really interesting deals in energy. In fact, we spent a lot of time actually pivoting and spending time in energy, looking at, you know, everything from, you know, producers of Nat Gas and Oil to, you know, folks that were building terminals to LNG facilities.”

Sacks energy w=0.94 · n=16 · E102 (2022-10-29) · explicit_prediction · strength 2 ▶ 1:22:25 SUPPORT

“So I think there's a lot of things that could go wrong here when the US is now escalating geopolitical tensions and competition, not just on one front, but on two fronts.”

Chamath energy w=0.55 · n=22 · E103 (2022-11-05) · explicit_prediction · strength 3 ▶ 1:07:49 SUPPORT

“But the reality is, if you look at this, we have now depleted our strategic oil reserve by almost 50%. Yeah. So we are running out of oil that we can introduce into the market at effectively zero cost to bring the price down. And because we've lost our relationships with folks like Saudi Arabia, there's no way to influence them in order to produce more. In fact, they're going to cut supply so that they can control the prices that they have, that they can sell into the market.”

Friedberg energy w=0.78 · n=18 · E109 (2022-12-24) · positioning · strength 3 ▶ 26:42 SUPPORT

“I traded it too. I bought an energy ETF, so it worked out for me.”

Sacks energy w=0.94 · n=16 · E109 (2022-12-24) · explicit_prediction · strength 3 ▶ 23:46 SUPPORT · horizon 12mo

“So these companies are going to keep doing well for the next year at least.”