Energy Prospectus

https://www.youtube.com/watch?v=NN0T7Ruq8iM

Points I make in the podcast
1. Oil and gas prices were higher in Q1 than they were in Q4, which is primary reason all of our Sweet 16 reported strong Q1 2025 financial results. They should all be able to remain free cash flow positive if WTI stays over $60/bbl and natural gas prices stay over $3.50/MMBtu. EIA is now forecasting the U.S. natural gas will average $4.60/MMBtu. JAN26 NYMEX contract for HH Ngas is $5.15 this morning. All of the Sweet 16 companies produce a significant amount of natural gas and NGLs.
2. Higher oil and gas prices in Q1 tell me that the fundamentals pointed to higher commodity prices before the Tariff War started.
3. Outlook for natural gas and NGL prices in 2026 continues to look very bullish.
4. Oil price pullback is primary due to demand concerns: FEARs of "Drill Baby Drill" and potential global recession due to impact of the Tariff War.
5. Big Three petroleum inventories are below normal for this time of year: Proof that supply/demand fundamentals are not bearish. It is hard to make a fundamental argument for lower oil prices unless we do see proof of a recession.
6. OPEC+ announced quota increases are not really increases in physical oil supply.
7. Military strikes against Iran's nuclear facilities seem more likely to me each week.

Watch is this podcast to understand some of the points I made in my podcast.
https://www.youtube.com/watch?v=3C-nxHnjq28

1. "Drill Baby Drill" WILL NOT HAPPEN unless oil prices go A LOT HIGHER.

2. Even if the D&C capex doubled in the U.S., it will not have the same impact on U.S. oil production that it had in Trump's first term. U.S. oil production HAS PEAKED and could decline by 500,000 bpd by end of THIS YEAR.

3. Natural gas prices in North America have remained MUCH LOWER than the international gas prices because of all of the "associated gas" coming from the oil shale plays. The "Right Price" for U.S. natural gas is much closer the energy content of natural gas compared to oil. Six MMBtu of natural gas has the same energy content of one barrel of oil. I believe that the "Right Price" for North American natural gas will be 1/10th the price of oil by the end of this decade. We will see HH natural gas over $5.00/MMBtu by the end of THIS YEAR.

4. Natural gas prices have rebounded and are likely to go MUCH HIGHER because of (a) the colder than normal 2024/2025 winter that drained storage and (b) increase in LNG export capacity. LNG export demand will continue to grow, rapidly increasing demand for electricity can only be met by a big increase in natural gas fired power plants, and the associated natural gas production from oil wells will not keep increasing. In the near-term Appalachia, Haynesville Shale in Louisiana and South Texas have enough pipeline capacity to increase natural gas supply, but not enough to meet the demand increase coming in 2026.

5. In the last ten minutes of the podcast he explains why EVs have not and WILL NOT reduce oil demand.