Super-Spiked Podcast

WATCH the video on Substack by clicking the play button above or on YouTube (here).STREAM audio only on Apple Podcasts (here), Spotify (here), or your favorite podcast player app.DOWNLOAD a pdf of a moderately edited transcript using the blue Download button below.A recurring theme from many of our recent meetings and engagements is around the role of China in energy markets going forward. Here are nine China-related thoughts in the context of our Geopolitical Super Vol macro framework.* China’s massive trade surplus with the rest of the world is not sustainable. * Industrial diversification away from China is inflationary, and at least in the short-term, higher in energy intensity than the status quo. * From the perspective of energy, peak trade surplus by China likely coincides with peak energy usage in the country. A plateau in its oil and coal demand seems possible in coming years under the assumption that the rest of the world makes headway diversifying manufacturing away from China.* Whether China can transition to more of a consumer market from a heavy industry, export oriented economy is a question that is beyond our ability to intelligently comment as an energy specialists and is the key to its long-term energy growth potential.* We do not believe peak or plateauing oil demand in China means peak global oil demand is here, as the other 6 billion people on Earth outside of China still have massive unmet energy needs. * China is still building coal plants even as it is meaningfully ramping solar, wind, batteries, and nuclear. This is a real lesson the U.S., Canada, and Europe ought to embrace. Build and definitely don’t close baseload power generation as you are adding renewables and other new technologies. * Increased volatility in China oil imports likely mutes the extreme ends of the oil price trading range, as we expect the country to add to strategic stocks on pullbacks toward $50/bbl or lower with reduced imports when oil is trading above $90/bbl. * For companies in the oil value chain in particular, cash is king.* For the power value chain, higher inflation means higher borrowing costs. All the turmoil in the world creates supply chain risk. Let us conclude with this takeaway: China did not matter to energy analysis prior to 2004 and may become less relevant within the next few years (to be clear, China will remain important but may no longer be the top driver is our point). The Asia Tigers stopped mattering in 1998. Japan and Western Europe stopped mattering a few years before that. So if we think about macro eras, which countries are the driver evolve as well.There is only one long-term direction of travel for the world and that is one of more prosperity and progress over time, even as the path can sometimes be rocky. There are still at least 6 billion people ready to move up and to the right economically. The 2030s may well be more about some or all of those other 6 billion people than it will be about China.📜 Credits* Intro & Outro music: Wolf Hoffman: Concerto for 2 Cellos in G Minor, Rv 531: I. Allegro Moderato.* This episode of Super-Spiked Videopods was edited and produced by Veriten Productions.⚖️DisclaimerI certify that these are my personal, strongly held views at the time of this post. My views are my own and not attributable to any affiliation, past or present. This is not an investment newsletter and there is no financial advice explicitly or implicitly provided here. My views can and will change in the future as warranted by updated analyses and developments. Some of my comments are made in jest for entertainment purposes; I sincerely mean no offense to anyone that takes issue.Subscribe to receive all content. Also available at Veriten.com. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit arjunmurti.substack.com

WATCH the video on Substack by clicking the play button above or on YouTube (here).STREAM audio only on Apple Podcasts (here), Spotify (here), or your favorite podcast player app.DOWNLOAD a pdf of a moderately edited transcript and the slide deck using the blue Download buttons below.One of our core Super-Spiked themes since inception nearly five years ago has been the idea that companies in deeply cyclical commodity sectors should aim to have a fortress balance sheet, and that you run the business to ensure that you can not only survive but actually thrive through industry downturns. Preparation for bad times is what enables success during the bull markets. It’s what positions companies to keep pace with and beat the broader S&P 500 over the decades through all the ups and downs. From the breakup of Standard Oil in 1911, its largest surviving pieces plus Royal Dutch/Shell not only survived but thrived over the next 100 years until the end of the China/BRICs super-cycle in 2014. We are currently in an era where oil prices are around $100/bbl and refining margins are over $60/bbl and companies exposed to upstream and downstream oil commodity value chains are increasingly flush with cash. Today’s video adds a corollary to our fortress balance sheet ethos and that is “cash is king.” We have little doubt that Street analysts on upcoming 3Q2026 earnings conference calls will be querying management teams on what they will do with the cash and many will argue some large portion ought to be immediately returned to investors. If we are sticking with our pragmatic approach to energy, some of the surplus will and should go back to investors. But there are a number of arguments made about returning all or the bulk of cash back to investors that we do no agree with. The strategic value of cash, especially in a deeply cyclical commodity business, is often under appreciated by both investors and management teams. It’s not simply having a fortress balance sheet. It’s about having a degree of balance sheet strength that enables significant counter-cyclical buybacks, M&A, or CAPEX. We would argue there is no such thing as having too much cash on hand, especially given our Geopolitical Super Vol macro framing. 0:00 Introduction 2:42 Cash is King 9:37 Pushbacks On Retaining Cash 15:48 On A Personal Note: In Honor of Malcolm Young 📜 Credits* Intro & Outro music: Wolf Hoffman: Concerto for 2 Cellos in G Minor, Rv 531: I. Allegro Moderato.* This episode of Super-Spiked Videopods was edited and produced by Veriten Productions.⚖️DisclaimerI certify that these are my personal, strongly held views at the time of this post. My views are my own and not attributable to any affiliation, past or present. This is not an investment newsletter and there is no financial advice explicitly or implicitly provided here. My views can and will change in the future as warranted by updated analyses and developments. Some of my comments are made in jest for entertainment purposes; I sincerely mean no offense to anyone that takes issue.Subscribe to receive all content. Also available at Veriten.com. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit arjunmurti.substack.com

WATCH the video on Substack by clicking the play button above or on YouTube (here).STREAM audio only on Apple Podcasts (here), Spotify (here), or your favorite podcast player app.DOWNLOAD a pdf of a moderately edited transcript using the blue Download button below.This week we have a twist on our Q&A styled commentaries, which we are calling “Good Call or Bad Call.” We focus on oil markets with four topics to go through. The point of the post is to shed light on signal from noise and when to push back on consensus narratives.(1) About a month ago, U.S. Energy Secretary Chris Wright made headlines stating that oil flows out of the Strait of Hormuz and the Middle East in general were much higher than everyone realized. His comments were broadly dismissed as happy talk from an administration that was desperate to see lower gasoline and diesel prices ahead of upcoming midterm elections. Was it a good call or bad call to doubt Secretary Wright’s comments on Middle East oil flows?(2) Has it been a good call or bad call to believe in the oil glut narrative?(3) Is it a good call or bad call to think recent changes to U.S. fuel economy rules announced by the Trump Administration will gut mpg improvements and boost gasoline demand?(4) Has our Super Vol framework been a good call or a bad call?📜 Credits* Intro & Outro music: Wolf Hoffman: Concerto for 2 Cellos in G Minor, Rv 531: I. Allegro Moderato.* This episode of Super-Spiked Videopods was edited and produced by Veriten Productions.⚖️DisclaimerI certify that these are my personal, strongly held views at the time of this post. My views are my own and not attributable to any affiliation, past or present. This is not an investment newsletter and there is no financial advice explicitly or implicitly provided here. My views can and will change in the future as warranted by updated analyses and developments. Some of my comments are made in jest for entertainment purposes; I sincerely mean no offense to anyone that takes issue.Subscribe to receive all content. Also available at Veriten.com. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit arjunmurti.substack.com

WATCH the video on Substack by clicking the play button above or on YouTube (here).STREAM audio only on Apple Podcasts (here), Spotify (here), or your favorite podcast player app.DOWNLOAD a pdf of a moderately edited transcript using the blue Download button below.It’s a heavy travel week so this is going to be a quick audio only commentary. On Veriten’s Close of Business Tuesday podcast this past week, we had oil industry veteran Scott Sheffield on to discuss his new memoir, “From Tehran to the Permian” (here). Scott of course was the long running CEO of oil & gas exploration and production company Pioneer Natural Resources and its predecessor Parker & Parsley spanning over three decades. Scott’s career as CEO covered all four of the oil macro eras we highlighted a few weeks ago in our 20 Years of “A View from Wall Street” at Oxford podcast that discussed how corporate strategy needs to evolve depending on what macro era you are in and how mature a given era is (here). We give Scott, as a very long serving CEO, a lot of credit that his management style allowed Pioneer to thrive across very different oil macro environments. It is rare for a CEO to last that long and it is even rarer for a leader to be as adaptable as he was. If you pull up PXD’s stock chart, it was not a straight line up, but the low points didn’t break the company and every time they emerged stronger than before, culminating in the sale of the company in 2024 to ExxonMobil at an all-time high that resulted in PXD outperforming the S&P 500 by a good amount over his tenure. 📜 Credits* Intro & Outro music: Wolf Hoffman: Concerto for 2 Cellos in G Minor, Rv 531: I. Allegro Moderato.* This episode of Super-Spiked Videopods was edited and produced by Veriten Productions.⚖️DisclaimerI certify that these are my personal, strongly held views at the time of this post. My views are my own and not attributable to any affiliation, past or present. This is not an investment newsletter and there is no financial advice explicitly or implicitly provided here. My views can and will change in the future as warranted by updated analyses and developments. Some of my comments are made in jest for entertainment purposes; I sincerely mean no offense to anyone that takes issue.Subscribe to receive all content. Also available at Veriten.com. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit arjunmurti.substack.com

WATCH the video on Substack by clicking the play button above or on YouTube (here).STREAM audio only on Apple Podcasts (here), Spotify (here), or your favorite podcast player app.DOWNLOAD a pdf of a moderately edited transcript and the slide deck using the blue Download buttons below. We provide takeaways following a number of New York City Climate Week events we attended this past week. We are going with an optimistic take directed at those of you that place a high priority on addressing carbon emissions: in my 34 year career, the outlook for new energy technologies has never been brighter. The vast bulk of new energy tech is de facto lower carbon in nature. The favorable outlook is being driven by economic and geopolitical security fundamentals that are consistent with energy’s natural hierarchy of needs along with our Lucky 1 Billion Other 7 Billion person framing. This is and always has been the basis for all energy and economic development. Notable events we attended were hosted by the US-India Strategic Partnership, ClearPath and API, and the Center On Global Energy Policy—developing world, right of center, left of center were represented and all recognized energy’s natural hierarchy of needs. Pretending carbon emissions is anyone’s organizing principle, mercifully, was not the view at any of the events. Notably, decreased carbon intensity of economic growth was the clear result of the focus of everyone on Earth deserving to be energy rich. 0:00 Introduction 3:07 FAQ on Climate 10:28 On A Personal Note: I ❤️ New York 📜 Credits* Intro & Outro music: Wolf Hoffman: Concerto for 2 Cellos in G Minor, Rv 531: I. Allegro Moderato.* This episode of Super-Spiked Videopods was edited and produced by Veriten Productions.⚖️DisclaimerI certify that these are my personal, strongly held views at the time of this post. My views are my own and not attributable to any affiliation, past or present. This is not an investment newsletter and there is no financial advice explicitly or implicitly provided here. My views can and will change in the future as warranted by updated analyses and developments. Some of my comments are made in jest for entertainment purposes; I sincerely mean no offense to anyone that takes issue.Subscribe to receive all content. Also available at Veriten.com. This is a public episode. If you would like to discuss this with other subscribers or get access to bonus episodes, visit arjunmurti.substack.com