Super-Spiked Videopods (EP51): Copper, Crude, China, Normalization 

This week we continue the theme of normalization. The 2020-2023 period of “urgent energy transition,” “peak oil and gas demand,” and ESG hysteria we think is fading. It is being replaced with what we would call “normal” supply/demand/price volatility concerns. The biggest issue right now facing oil markets has been uncertainty on the outlook for China in particular. Going back to the super-cycle days of 20 years ago, we have long looked at copper markets to provide insights into China, given China is over 50% of copper demand. A noticeable gap has opened between weak crude oil prices and more resilient copper. Historically, the gap has closed with crude following the direction of copper. We shall see if history repeats.