Heavyweight Energy Capitalists See Huge Upside in "Green" Energy

Heavyweight Energy Capitalists See Huge Upside in “Green” Energy

by | published January 15th, 2020

Last week has been the latest phase in ongoing discussions with some major global energy investment figures. Beginning with meetings on board a ship off Tortola in the British Virgin Islands through conference calls over the weekend, I once again plugged in to the opinions of those who drive wide areas of investment in diverse corners of the globe.

These folks administer or personally commit billions in global investment, both in energy and related market sectors. I provide analysis and market advisory services during these sessions.

On occasion, this means I receive an early indication of where they plan to commit funds.

When this happens, some serious money can be made.

This Activity Points to Major Profit Opportunity

Much of the initial moves are into private companies and projects. As such, there is no direct access for retail investors, since no publicly traded stock is involved. Nonetheless, knowing where the next targets are emerging sometimes allows me to identify available plays among publicly traded companies likely to benefit.

For several years now, I have discussed here in Oil and Energy Investor my involvement in such meetings. They have taken me from Europe to Asia, North Africa to Brazil, the Persian Gulf, royal audiences at Windsor Castle outside London, Moscow, and the Caribbean.

Whenever this group assembles, major investment trends are afoot.

But there’s a problem – one of interpretation. It is an ongoing matter of disagreement in my circles over whether the intel we exchange can be construed as “inside information.” If the move is on a private entity, my guys believe there is no inside impact (since there is no effect on the trading of any equity).

Moreover, if the company of interest is public there are some in the group believe it is not insider trading if the company does not know the outside investment (i.e., theirs) is coming.

I have always taken a very conservative view. I regard all intel generated from these sessions as potentially being “insider” in nature. Therefore, I have refrained from using any particular elements from our discussions until related information emerges publicly from other sources providing a reason for recommending a play.

After all, even though the impending investment may not be in a traded company, it may still affect publicly available stock.

In any event, this hardly prevents me from discussing in OEI what directions this investment is about to take. It also allows me to recommend moves you can make in broader market areas reflecting these directions.

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Major energy investors are still directing attention to what I have termed the energy sourcing balance. There will still be money moving into traditional sources like crude oil, natural gas, and even coal, especially in global regions like Asia where such sources are essential to continue meeting the world’s primary demand (moving rapidly to Asia for the next several decades).

Right behind the Asia push is one toward the last major opening market on Earth: Africa. I’ll have more to say about this in due course.

But today I’ll reveal more immediate developments.

The alternative move into renewables like solar and wind power has been underway for some time. In fact, these have resulted in the most profitable moves for these guys over the past two years.

The latest discussions in the eastern Caribbean revealed the next two emphases among the heavy hitters. Each also provides a move you can make without replicating their investment, and each is also a major departure from where money has been moving.

Make no mistake: There is no altruism at work here. These folks make decisions based on profit margins and rate of return.

Major Investors Are Making This a Top Priority

First, a major thrust is underway in energy sustainability. The subject has recently emerged as a major theme following BlackRock’s announcement yesterday. The largest asset manager in the world is putting sustainability as a new main standard in its investment. But movement in this direction has been underway among heavy hitters in energy for a while.

Perhaps, this emphasis has become visible to BlackRock as it “bubbles up” from investors to the asset managers.

In addition, this year’s fiftieth anniversary of the World Economic Forum in Davos, Switzerland (starting next Tuesday, January 21) is also emphasizing sustainability (is theme is: “Stakeholders for a Cohesive and Sustainable World”).

Sustainability addresses increasing energy from sourcing that has a positive impact on the environment while not being prone to a diminishing supply. This does involve renewables but also requires a more concerted view of how this is integrated into existing delivery systems while at the same time demanding a revised system of logistics.

Second, increasing global investment in energy efficiency constitutes what is probably the single most often focused subject in all of my meetings over the past twelve months. Once again, the emphasis is emerging because there is some big money to be made.

In addition, energy efficiency has knock-on effects. There is profit from wasting less energy at the same time as needs ripple into other market segments – construction, smart grids, building management, machinery and manufacturing, to name only the more immediate and obvious.

Last year when the issue surfaced in my meetings, the frustration from the investors involved how to monetize what is a clear direction from both an ecological and a coordination perspective. That was finalized in the meetings I had in the Persian Gulf back in November.

This time around, specific company targets were identified, and investment strategies finalized.

Now in both energy sustainability and energy efficiency we have publicly traded companies involved. That means the insider information concern arises. However, there are broader ways to play these developments that allow you to move on them anyway.

I will be naming these recommendations in the next OEI. Stay tuned.



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