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A structural supply shortage in sight for traditional energy, particularly gas
Growing Demand
Global energy demand is growing at 5%-10% as population grows and economy develops
Significant underinvestment
Significant decrease in oil/gas upstream for years since last oil peak in 2014, which was worsened with Covid 2020. (EIA data suggests global E&P investment was cut by 32% in 2020 alone)
Too agressive ESG
Too aggressive ESG policy has been worldwide promoted to curb traditional energy investment. Restrictions are implemented by many governments, institutions to invest and develop oil/gas project.
Shift from coal to gas
Many countries including China are taking aggressive move to shift from coal to gas for power generation, and this trend is going to last for decades.
Geopolitical tensions
More frequent geopolitical conflicts and trend of de-globalisation are undermining an efficient energy commodity market, which might inevitably cause more volatility.
Mis-perception on new energy transition
The pace of new energy growth fails to catch up with energy demand, and society/investors has underestimated the magnitude of the impact of not producing enough fossil fuel.
Global LNG trade in million tons (Mt) 2000-2020. Source: International Group of LNG importers
Global investment in oil and gas upstream from 2010 to 2020. Data source: International Energy Agency
JKM (Japan & Korea Marker) LNG spot price Sep 2012-Aug 2022. Source: Investing.com
