Jeff Currie

Global oil inventories are lower today than a year ago, yet the price is suppressed by algorithmic trading and negative sentiment. The "Oil Glut" narrative has zero fundamental evidence. The market is physically tight but financially loose. Eventually, a physical catalyst (like a supply disruption in Iran or simple inventory exhaustion) will force the "paper" market to realign with the "physical" reality. Long Oil. The risk/reward is skewed to the upside as the "artificial" price suppression cannot last against physical shortages. A deep global recession destroying demand or a sudden peace deal with sanctioned nations (Iran/Russia) bringing supply back online.

Global oil inventories are lower today than a year ago, yet the price is suppressed by algorithmic trading and negative sentiment. The "Oil Glut" narrative has zero fundamental evidence. The market is physically tight but financially loose. Eventually, a physical catalyst (like a supply disruption in Iran or simple inventory exhaustion) will force the "paper" market to realign with the "physical" reality. Long Oil. The risk/reward is skewed to the upside as the "artificial" price suppression cannot last against physical shortages. A deep global recession destroying demand or a sudden peace deal with sanctioned nations (Iran/Russia) bringing supply back online.

Currie says, "If you're China, you're India, you're going to start to hoard oil and not only oil, but all commodities... The hoarding situation is going to become more extreme." The bifurcation of the world into two supply blocs (US vs. China) forces large importers to build massive strategic reserves. This creates a source of price-insensitive demand for hard assets, putting a floor under industrial metals and energy regardless of immediate economic consumption data. Long broad commodities and real assets. A strengthening USD which typically creates headwinds for commodities, or global recession.

Currie says, "If you're China, you're India, you're going to start to hoard oil and not only oil, but all commodities... The hoarding situation is going to become more extreme." The bifurcation of the world into two supply blocs (US vs. China) forces large importers to build massive strategic reserves. This creates a source of price-insensitive demand for hard assets, putting a floor under industrial metals and energy regardless of immediate economic consumption data. Long broad commodities and real assets. A strengthening USD which typically creates headwinds for commodities, or global recession.

Currie states that de-dollarization has accelerated since the US seized Russian assets in 2022. He notes, "You don't want to own dollar assets because the Americans can employ sanctions on you." This geopolitical fear forces central banks and sovereigns to hoard physical metal (Gold/Silver) as a reserve asset, creating price-insensitive demand that overrides traditional rate correlations. Long precious metals as a geopolitical shield. A sudden de-escalation in geopolitical tensions or a strengthening US dollar resolving the "bad character" perception of fiat.

Let's look at the equity market, energy, 3% of the market. How big are the things that are short? 53%. What is the multiple on that? Three, it's like 12 or 13. What is the multiple on the other one? 36 you're in trouble at the wealth level. The US economy is protected from energy shocks at the cash flow level (as a net exporter), but the stock market is dangerously unbalanced. As oil prices remain elevated due to structural hoarding and supply disruptions, capital will be forced to rotate out of high-multiple, energy-consuming sectors into low-multiple, cash-flowing energy producers to hedge portfolio risk. Energy equities are severely under-owned and mispriced relative to the broader market, making them a prime vehicle to capture the repricing of hard assets. A severe global recession could destroy baseline oil demand, offsetting the geopolitical and hoarding premiums currently supporting prices.

The need to redrill shut and potentially damaged oil wells after production halts will drive demand for drilling services, benefiting oil drillers. Drillers already rallied on this expectation, and the prolonged recovery supports further upside.

Own the hard assets, own the HALOs... revenge of the old economy, because it was coming off the back of the dot com boom this time around... I want to own metal. The global economy is shifting from a decade of digital, asset-light growth to an asset-heavy regime that requires massive amounts of physical materials. Rising costs of capital and labor will force a repricing of industrial metals and the companies that mine them, as new supply cannot be brought online quickly enough to meet the demands of this new economic era. Mining and metal equities offer leveraged exposure to the "revenge of the old economy" and the structural shortage of physical commodities. A strong US dollar or a severe manufacturing and real estate contraction in China could suppress base metal prices despite long-term supply constraints.

Jeff is a non-executive director at Abaxx Technologies. He highlights the need for better market infrastructure to trade "downstream" commodities like LNG and Lithium. The convergence of Web 3.0 (ledger technology) and AI allows for the creation of new, granular commodity markets that were previously impossible to trade. Abaxx is building the exchange infrastructure for these specific physical assets (LNG, Carbon). Long Abaxx as a play on the "Liquidity Explosion" in commodity trading infrastructure. Regulatory hurdles, technology adoption failure, or competition from established exchanges (CME/ICE).

We are seeing the "weaponization of the periodic table." Supply constraints are severe due to years of underinvestment, while demand is turbocharged by electrification, defense spending (5% of GDP in Europe), and AI data centers. Unlike the 2010s "asset-light" tech boom, the current cycle is "asset-heavy." AI requires physical infrastructure. Copper is the critical constraint for both the grid and data centers. Jeff explicitly notes that owning the equities (miners) offers a smoother ride than the physical commodities. Long copper miners as the primary beneficiaries of the "Bits meet Atoms" convergence. A global recession or a collapse in AI capex spending would temporarily crush industrial metal demand.

AI compute demand is creating an energy crisis. While Nuclear is the ideal solution, it takes decades to build. Natural Gas is the only scalable, immediate power source to bridge the gap between current AI demand and future Nuclear capacity. Jeff notes that while gas prices crashed from $7 to $3.20, the demand floor from data centers is rising. Long Natural Gas exposure. The current price weakness is a buying opportunity before the "summer of 2026" demand shock from cooling and data centers hits. Warm winter weather or faster-than-expected efficiency gains in AI chips (reducing power consumption) could keep gas prices depressed.

We are seeing the "weaponization of the periodic table." Supply constraints are severe due to years of underinvestment, while demand is turbocharged by electrification, defense spending (5% of GDP in Europe), and AI data centers. Unlike the 2010s "asset-light" tech boom, the current cycle is "asset-heavy." AI requires physical infrastructure. Copper is the critical constraint for both the grid and data centers. Jeff explicitly notes that owning the equities (miners) offers a smoother ride than the physical commodities. Long copper miners as the primary beneficiaries of the "Bits meet Atoms" convergence. A global recession or a collapse in AI capex spending would temporarily crush industrial metal demand.

AI compute demand is creating an energy crisis. While Nuclear is the ideal solution, it takes decades to build. Natural Gas is the only scalable, immediate power source to bridge the gap between current AI demand and future Nuclear capacity. Jeff notes that while gas prices crashed from $7 to $3.20, the demand floor from data centers is rising. Long Natural Gas exposure. The current price weakness is a buying opportunity before the "summer of 2026" demand shock from cooling and data centers hits. Warm winter weather or faster-than-expected efficiency gains in AI chips (reducing power consumption) could keep gas prices depressed.

Double down on being long grains, particularly corn, because the Black Sea grain corridor has been taken out by the conflict in Ukraine, severely restricting supply.

Bullish on the entire commodity complex, specifically doubling down on agriculture, gold, and silver, due to numerous global choke points and weather events squeezing supply.