If you aren’t long energy now, you probably never will be

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Demand for hydrocarbons is driving a quarter-decade investment opportunity, despite a revolution in electric vehicles and renewables over the longer term, says Lazard Asset Management portfolio manager Dr Philipp Hofflin.

The current $166 price of a barrel of oil equivalent (BOE) is the lowest in some 23 years – far below the BOE’s historical peak of $630 and lower than its most recent nadir of $175 in 1998.

“Low prices are not a good reason to buy energy stocks – far from it. But the prices of those stocks usually get marked down very heavily as well,” Hofflin says.

“From that starting point you end up doing very well because the price eventually goes up”

The threat from EVs and clean energy looms for oil and gas producers and coal miners around the world – but is far closer in Europe than in South East Asia, where energy dynamics are markedly different.

In the following interview, Hofflin explains why Australia’s largest gas producer Woodside and mid cost curve coal miner Whitehaven are so appealing at current prices, albeit as “special high-risk, high-return propositions.”

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You can stay up to date with all of Philipp's latest insights by following him here.



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