MB Fund Podcast: The Great Energy Bubble and Bust

In today’s investment webinar MB Fund’s Chief Strategist David Llewellyn Smith, Head of Investments Damien Klassen, and Marketing Coordinator Jayden Stent discussing if an Energy Crisis is inevitable

On the agenda:

  • Roll up for the amazing energy bubble
  • Demand drivers
  • Supply drivers
  • Paths of resolution
  • Investment implications

Can’t make it to the live series?  Catch up on the content via Podcasts or our recorded Videos.

Take us on your daily commute! Podcasts are available on iTunes and all major Android Podcast Platforms for Nucleus Investment Insights.



Damien Klassen is Head of Investments at the MacroBusiness Fund, which is powered by Nucleus Wealth.


The information on this blog contains general information and does not take into account your personal objectives, financial situation or needs. Past performance is not an indication of future performance. Nucleus Wealth Management is a Corporate Authorised Representative of Nucleus Advice Pty Ltd – AFSL 515796.


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  1. You identify a combination of short term Covid-related demand plus a ‘perfect storm’ of combined weather and political influences (Russia/China) that have temporarily drained world energy inventories and inflated an unforseen temporary bubble, which will dissipate in 2022 resulting in a return to the BAU growth paradigm.

    While you may be right about 2022, I doubt it will be the case for long for three reasons – 1) your glossed-over ESG; 2) that lower post-Covid incomes will be unlikely to permit a return to pre-Covid services & consumer spending for long, if at all; and 3) the ever-rising cost of FFs (and the vast quantities of these, plus metals and minerals that will be needed for any ‘energy transition’).

    All three will eventually lead to the supply and demand for services and goods being lower going forward for the vast majority of people – and so the consumer-led perpetual growth machine of the last 300 years that began to decline in the 70s, (being replaced first by debt as a coping-mechanism, then money printing, but which is now nearing an end), will continue to inevitably grind lower, to the point that the world will be either forced to acknowledge it, and work to rationalise what is essential and what is not in order to keep the lights on and the majority of the world clothed and fed, or persist in denying that the growth fantasy of the last 300 years – but particularly the last 50 – is in fact, dead.

    Whether the world knows it or not, it has reached a turning point as it faces a predicament whereby renewables can in no way replace FFs for at least 20 years, but neither can it continue to depend on them to either continue to power the global economy, or to rejig it for renewables.

    Hopefully the PTB will eventually (but fairly soon) be forced to acknowledge that BAU can’t continue. If not, chaos is inevitable as that which can’t be sustained, won’t be.

    Unfortunately the ‘macro’ economic view looks only 12-18 months into the future, whereas to get a realistic view it needs to be at least 5-10 years. I find it hard to believe that two very smart people don’t look far enough into the future to see that the long term trend since the 70s has been down – for the simple reason that the cost of once easily-accessed and dirt-cheap energy (the enabler of industrial civilisation) has overall risen steadily since then, and that declining living standards for the majority in the West stem from this, while dependency remains complete (EM rose for a while as energy costs, needs and complexity were lower).

    Energy is a complex issue. The Peak Oil movement in the early 2000s anticipated an imminent end to FFs and global collapse, which due to the closely-followed US fracking euphoria, was replaced with the popular and near-universal mantra of the forever-abundance of FFs. Reality is somewhere in between – while there will always be FFs, their ever-increasing cost and availability geologically, geographically and politically, will be challenging, not solely due to ESG.

    I guess that the purpose of MB is to look to the next year or 18 months for investing purposes which in a massively complex financial scene is a gargantuan task on its own, but I do hope both MB and its readers are doing some real world longer term research to equip them for a troubled future in which BAU can never return.


      • There is no replacement for oil; renewables don’t come close, and higher prices merely crash an already vulnerable economy. And that comment is econospeak for “assume a tin opener” Lol 🙂

    • folks are fast coming to realise that nuclear power generation is the only way this planet can sustain 8 billion heads and get anywhere near net zero carbon emissions… Germany must be right now kicking themselves pretty hard every time they boil the kettle!

      I’d expect to see crude and LNG demand start tapering off as an additional 50, 100 or 200? nuclear power plants are built and commissioned world-wide… that wont take long will it? LOL

      In all likelihood, I would think 8 billion population will decline faster than the price of a barrel of oil in the coming decades. #OverShoot

      • “I would think 8 billion population will decline faster than the price of a barrel of oil in the coming decades. #OverShoot”

        Yep. Sadly, uranium is in short supply too, no where near enough for all those reactors (thank dog)

  2. Well said drt15.
    7 years of under-investment in oil and gas , below replacement level, many of those years.
    The IEA have been warning of a supply shock in the future (23-24 i think they called) for quite some time.
    It took 4 years to drill out of, the last time oil hit 100 a barrel. Thats with Shale oil at all systems go.
    That is not gonna happen this time
    Energy is the economy- hard to believe from melbourne i know.

  3. RanganutsMEMBER

    I bought 10k WPL shares yesterday and am short to medium term very bullish on energy stocks, been accumulating over the last 18 months. It’s gonna take decades to replace oil and gas, they are simply too good at doing what they do.

    I’m not sure if the universe was telling me something though because as I was driving home in my diesel powered 4 x 4 a Tesla whipped past me with the personalised numberplate, “LOL OIL” (I sh!t you not!).