Oil and gas
An interesting graph from Morgan Stanley, which depicts the rising share of EV’s, plotted against the oil consumption stats (kb/d) for Norway.
The general point is that oil is used in transport, amongst other things, which grows alongside the population, and that increasing EV penetration isn’t a reason to be completely bearish on oil prices in the short to medium term.
It is, perhaps, a bit like the analogy to Philip Morris, in which smoking as a % of the population has gone down, but the number of humans has gone up, such that the absolute volumes are more or less stable, and given price increases, has actually generated fairly robust revenue growth for many, many years.
Australian listed oil and gas plays are, to our mind, very cheap, and that oil will be a material part of the energy mix for the next decade or so, long enough to have generated meaningful returns from our upstream (WPL, ORG) and downstream (MND) exposures.
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