• The impact of EV's - EV euphoria took over the auto industry over the past several years, today however the hype is dwindling. EVs have won over the early adopters, but the vast majority of consumers aren’t quite ready to follow.
• Demand for oil – We feel oil demand will likely peak in the next 5-10 years and major oil producers forecast that oil demand will likely peak by 2030. Thus, major oil producers are gradually pivoting capital expenditures toward integrated gas and lower carbon technologies.
• Oil supply - From an oil supply perspective, in the near- to medium-term, we have a rather balanced market where OPEC has enough control to smooth fluctuations and keep oil prices rangebound – at a high (but not too high) level of around $80. However, growth outside of OPEC and the U.S., particularly in offshore Latin America, Africa and Asia as well as growth in shale production outside of the U.S. risk oversupplying the oil market longer term, especially if energy transition indeed results in peak oil demand around 2030.

Energy transition is not a buzzword or a flavour of the month – it is real and growing. The popularity of EVs will likely continue to grow. The demand for oil will have to peak at some point and will decline, but the reality is that we will be using oil for a long time, which is why the goal is to get to a "net" zero. On the supply side, there is no shortage of oil in the ground and observers need to be mindful of OPEC actions. A $70-$90 oil is a sweet spot that is acceptable to both producers and consumers and oil is likely to stay range-bound. Investors just need to keep in mind that in the world of commodities, things always change.

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