Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
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Speaker 4: This is Bloomberg Intelligence Radio.
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Speaker 3: They cover two thousand companies and one hundred and thirty
Speaker 3: industries all around the world. So, in case you didn't know,
Speaker 3: bitcoins now up over one hundred thousand dollars. This comes
Speaker 3: a day after President Trump picked a pro crypto pick
Speaker 3: for the SEC.
Speaker 4: That was a hard thing to say. Pro pro crypto pick. Yeah,
Speaker 4: try to be that fast. More so than Gary Gensler,
Speaker 4: I guess much more so. This is Paul Atkins.
Speaker 3: Apparently he is a crypto proponent, but also very much
Speaker 3: in favor of.
Speaker 4: Less regulation et cetera. Broadly, Yes, I'm.
Speaker 5: In an upgrade on the Newark closing. Oh okay, okay,
Speaker 5: just real quick, the FAA says Newark Airport closed to
Speaker 5: general aviation aircraft, so not commercial, not the big jets,
Speaker 5: the smaller planes. That's the rinking planes that I flowed.
Speaker 6: That's what That's why we have titoborough going too there
Speaker 6: for their ranking, the smaller private craft.
Speaker 4: Right, Okay, Okay, well I'm glad. I'm gonna be sure.
Speaker 6: About to find them Marshtown.
Speaker 1: Okay.
Speaker 3: So we bring you weather updates and air updates as
Speaker 3: well as talking to our Bloomberg Intelligence guys, and for
Speaker 3: that we have go to Michael mcgloan. He is Bloomberg
Speaker 3: Intelligence senior commodity strategist and he's in Florida, so he
Speaker 3: doesn't have any win weather issues right now. All right, Mike,
Speaker 3: I know a lot of hayes being made about one
Speaker 3: hundred thousand dollars, does it?
Speaker 4: Do we need to retrace here though at some point.
Speaker 7: That seems a bit elusive at the moment, Alex, it's
Speaker 7: it's it's fouled the money. It's been since this year started,
Speaker 7: about thirty two billion dollars of ETF inflows. Since President
Speaker 7: Trump was elected, about eight billion dollars of ETF inflows.
Speaker 7: And to put that in context, there's been on the
Speaker 7: year about almost six billion dollars of outflows in gold
Speaker 7: ETF Now they've picked up recently, but yeah, so me
Speaker 7: to me, that's from a commander standpoint, this is what's happening,
Speaker 7: I think is one hundred thousand. It's pretty good resistance.
Speaker 7: It's a milestone. I think it really brings into the forefront.
Speaker 7: But it's also showing the major paradigm shift. Of holding
Speaker 7: gold without bitcoin in that space is just for miss.
Speaker 7: You have to have some bitcoin in there or your
Speaker 7: miss risk of missing out. So to the key thing
Speaker 7: I've been watching today is the ounces of gold per
Speaker 7: one bitcoin may a new high up to thirty nine.
Speaker 8: Right now it's about thirty eight.
Speaker 7: And questions what stops that trajectory from going higher?
Speaker 6: Mike, give us a sense of how you think it
Speaker 6: might be reasonable to try to value a commodity or
Speaker 6: a currency like bitcoin. Do I look at a relative
Speaker 6: to I don't know, pork bellies or gold?
Speaker 4: Laughing at you right now, yeah what do I do?
Speaker 9: Paul?
Speaker 7: I enjoyed the question bit snickering because it's like, right now,
Speaker 7: it's animal spirits.
Speaker 2: It's it's the way I always look at.
Speaker 7: Commandis supplying demand. Now that's one thing about bitcoin has
Speaker 7: definable diminishing supply. Basically on the mount you can only
Speaker 7: mine a day is four hundred and fifty bitcoins, and
Speaker 7: that's going to cut and be cut in half in
Speaker 7: twenty twenty eight. And it's just the way it's set up.
Speaker 7: And there's increasing demand and adoption, so price must go
Speaker 7: all over time, and it's just going to have these nuances.
Speaker 7: But right now it's about the major shift in this
Speaker 7: country from being really pushing against cryptos, as we saw
Speaker 7: with Gary Gensler, now shifting over to a whole government
Speaker 7: that's so much positive cryptos, and you see things like
Speaker 7: the potential for us to be in the USA if
Speaker 7: you actually sell gold and buy bitcoin, which I think
Speaker 7: is a bit wild, but that was a bloomberg story
Speaker 7: that really hit this tape. The tape this weekend. So
Speaker 7: and then quotes from Chairman Powell pointing out that it's
Speaker 7: digital gold, and even from President Putin, there's nothing that
Speaker 7: can really stop it.
Speaker 8: It's it's the animal.
Speaker 7: Spirits right now. But it's the key thing I'm worried
Speaker 7: about is now that we have it into the mainstream
Speaker 7: and all the ETF people are buying and adding to
Speaker 7: the portfolio. We still haven't seen the big test of
Speaker 7: how bitcoin responds after President and Trump has been elected,
Speaker 7: when the stock market goes down, and you know at
Speaker 7: some point it will, and it hasn't been through that
Speaker 7: so right now, I think what you're seeing is a
Speaker 7: lot of people are adding it so that they're getting
Speaker 7: off zero, but it's still a highly speculus digital asset
Speaker 7: basically trains about three times voltuli of the S and
Speaker 7: P five hundred and goal.
Speaker 4: Oh wow, I.
Speaker 3: Did not know that stat when we when we had
Speaker 3: the optimism from Paul Atkins now being the nominee.
Speaker 4: For SEC, What regulation what?
Speaker 3: What do you think the crypto guys were so pumped
Speaker 3: about and that it was him versus a Gary Gens
Speaker 3: or like what kind of regulation there needs to be
Speaker 3: rolled back or needs to happen?
Speaker 4: In general, I.
Speaker 7: Think it's the the stop of the pushback. There was
Speaker 7: significant pushback. Let look how I mean the crypto people
Speaker 7: had to go to court to get ETF's launched and
Speaker 7: these things have been in it works for a decade.
Speaker 7: It was just kind of silly. I mean, those of
Speaker 7: us who trade commodity ETFs so forever, so they're very
Speaker 7: much more risky than a bitcoining death. So it was
Speaker 7: just silly. Some of the extreme relation that pushed against it.
Speaker 7: In the bottom line that always really kind of flummecks
Speaker 7: me was this space adopted the dollar as its space layer.
Speaker 7: And that's one thing I always say, well, if you're
Speaker 7: an American, why would you push back on that? And
Speaker 7: I think that's what's happened. We've had no Zeldt like
Speaker 7: a convert, mister Trump shifting over to being much more
Speaker 7: of a convert. And the key thing I like to
Speaker 7: point out is today, you know, we're all talking about bitcoin,
Speaker 7: but if you look at the trading volume and crypto's
Speaker 7: tether the dollar, the dollar token is trading almost three
Speaker 7: times the volume of bitcoin, and it's market cap is
Speaker 7: about one hundred and thirty billion. I remember first talking
Speaker 7: about in twenty eighteen. There's only two billion. It's just
Speaker 7: the technology is overwhelming, and it's really favorable for the
Speaker 7: US and for the dollar.
Speaker 6: All right, Mike, always good stuff chatting with you. Mike mcglowan,
Speaker 6: Senior commodity strategist. We'll talk port bellies next time.
Speaker 8: He's there.
Speaker 6: With Bloomberg Intelligence based down in Miami, I went to
Speaker 6: talking about oil because I'm watching the TV series Land Now.
Speaker 4: It's all the oil and history.
Speaker 6: How is it awesome? And I'm learning all about the
Speaker 6: oil and gas business.
Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live
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Speaker 2: Just Say Alexa playing Bloomberg eleven thirty.
Speaker 3: The top TiO political news of the last twenty four
Speaker 3: hours is what's happening over in France. We are still
Speaker 3: looking for President Emmanuel Macron to speak later on this afternoon.
Speaker 3: We're all waiting to see who he'll nominate as his
Speaker 3: next our premiere. They're facing a political crisis over in France,
Speaker 3: if you remember, the government lost a no confidence vote
Speaker 3: in parliament. In an exclusive interview at Bloomberg's, Francine Lachwa
Speaker 3: Marine La Penn, leader of the National Rally the far Right,
Speaker 3: discussed whether President Emmanuel Macross should resign. She said it
Speaker 3: was a personal decision. Led di Mission in Prison Live.
Speaker 9: What I said was that the president's resignation is a
Speaker 9: personal decision for him and can only take in my view,
Speaker 9: when a political crisis happens or an institutional crisis, can
Speaker 9: no longer have any other solution than the resignation of
Speaker 9: the President of the Republic. What I do wish, on
Speaker 9: the other hand, because for sure there will be new
Speaker 9: legislative elections in the next few months, is that we
Speaker 9: work on a voting system by then that enables us
Speaker 9: to have a real majority, whatever that majority may be.
Speaker 9: But the country needs a majority. It can't live for
Speaker 9: months and the years with three blocks, which in reality
Speaker 9: can't implement a policy.
Speaker 4: All right.
Speaker 6: That was marine A lepen, a, leader of the National
Speaker 6: Rally Party of France along with Bloomberg's front Sine Lacroix.
Speaker 6: Let's got the latest reporting from the French political situation.
Speaker 6: Phil Serafino joints a senior markets editor for Bloomberg News.
Speaker 6: He is in France, Phil, can you give us the
Speaker 6: latest reporting? What are the next steps here for French politics?
Speaker 8: Well, as you mentioned, Macron is speaking on French TV
Speaker 8: tonight Paris time, and the expectation is that, you know,
Speaker 8: by rights, he should be naming a new prime minister
Speaker 8: because because it's not good to have a caretaker government.
Speaker 8: The other existing Prime minister, Michelle Barnier handled in his
Speaker 8: resignation today after the no confidence vote. It's not clear
Speaker 8: though that in fact he will have a name ready
Speaker 8: to go tonight. It took him a couple of months
Speaker 8: over the summer to come up with the name of
Speaker 8: Michelle Barnier because he's trying to deal with a very
Speaker 8: divided parliament, as you mentioned. So he's speaking tonight. Whether
Speaker 8: he will have the name of a prime minister, we
Speaker 8: do not know yet, but that's the thing people are
Speaker 8: waiting for. Can he find someone who can bridge the
Speaker 8: political divide in parliament?
Speaker 3: So when Marie Lampenn comes out and says, I don't
Speaker 3: think you should resign, it's up to him, And then
Speaker 3: Matcross says he has no intention of stepping down.
Speaker 4: Are people asking him to do that?
Speaker 1: Like?
Speaker 4: Is that now in the zeitgeist?
Speaker 8: Yeah, there has been much talk of that. It's been
Speaker 8: kicking around for a few months since his party lost
Speaker 8: badly in the European elections and then in the following
Speaker 8: French parliamentary elections. That has been kicking around and he's
Speaker 8: said he's not going to do that. His term runs
Speaker 8: through twenty twenty seven. You get two five your terms
Speaker 8: in France, he wants to serve out his second term,
Speaker 8: so and it seems like a little bit of an
Speaker 8: olive branch on her part to say she's not pushing
Speaker 8: for that now there's still remains, there's there's a very
Speaker 8: difficult situation politically to get a budget passed and get
Speaker 8: it through parliament.
Speaker 2: So we'll see.
Speaker 6: Boy, I'm not sure i'd want to be prime minister
Speaker 6: there because as I understand the kidding, as I understand,
Speaker 6: it's almost like a no win situation here with the
Speaker 6: right and the left seemingly having some level of you know,
Speaker 6: being united here. Is there any room to govern here?
Speaker 8: Well, it seems like it's a very difficult needle to
Speaker 8: thread because the far right and the far left, you know,
Speaker 8: both have demands that Macron does not want to meet.
Speaker 8: He particularly does not want to deal with the far
Speaker 8: left party, which sort of dominates this three party coalition
Speaker 8: of left wing of left wing parties. So he's trying
Speaker 8: to come up with a sort of centrist approach to
Speaker 8: the budget. But they just tried that. They came up
Speaker 8: with what they thought was a compromise and it got rejected.
Speaker 8: So hard to see I mean, the math doesn't change
Speaker 8: in parliament just because the prime minister has stepped down.
Speaker 8: He still needs to come up with the budget that
Speaker 8: he can get a majority vote for, and unclear how
Speaker 8: that's going to happen.
Speaker 3: Okay, so on that here in the US, if you
Speaker 3: can't approve a budget or an extension, the government shuts down.
Speaker 3: What happens in France.
Speaker 8: I think they can do sort of an emergency budget.
Speaker 8: The problem is there are EU rules on the budget
Speaker 8: deficit and France has far exceeded those, and France has
Speaker 8: made pledges to the European Union that they will get
Speaker 8: that deficit under control with an emergency budget. I don't
Speaker 8: know that that does what they need to do as
Speaker 8: far as cutting spending and possibly raising taxes, And that's
Speaker 8: the sticking point. You know that the budget needs to
Speaker 8: cut spending and raise taxes. They're going to raise taxes
Speaker 8: on companies and the wealthy. Marie Lapenn today was saying,
Speaker 8: we're not going to do We're not going to go
Speaker 8: as far as you want it to go. We'll let
Speaker 8: the budget deficit run a little a little wider than
Speaker 8: we otherwise would. So I think in short term they
Speaker 8: can sort of paper things over. It's the medium term
Speaker 8: and the long term where they have a real problem.
Speaker 6: All right, Phil, thank you so much for joining us.
Speaker 6: Really appreciate it. Phil Sarafino, Senior market seditor for Bloomberg News.
Speaker 6: He is located in our Paris bureau.
Speaker 2: Here.
Speaker 6: Again, we'll hear from French President Macron at two pm
Speaker 6: Wall Street time eight pm Paris local time, and we'll
Speaker 6: see what he has to say about this government. Well,
Speaker 6: will he have a new prime minister to offer.
Speaker 4: I think it was.
Speaker 3: Carolyn Kannan yesterday who was talking to us about the
Speaker 3: fact that Marie La Penn doesn't actually want to be
Speaker 3: seen as an agent of chaos, like.
Speaker 4: That's not part of her goal.
Speaker 3: So that is also quite interesting in terms of how
Speaker 3: they will negotiate who will become the next premiere at
Speaker 3: the end of the day. I've also read some articles
Speaker 3: that look, Macross should give an Olive brand.
Speaker 4: To say the right, etc. More than centrist right. So
Speaker 4: it's gonna it's gonna be really quite complicated.
Speaker 2: You're listening to the Bloomberg Intelligence podcast. Catch us live
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Speaker 3: Alex Steel here alongside Paul Sweeney and John Tucker. This
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Speaker 4: Also check us out on YouTube as well.
Speaker 3: So for the markets, we hit the fifty six record
Speaker 3: high of the year. Market's going nowhere fast today. So
Speaker 3: what happens then if we get the Santa Claus Rally?
Speaker 3: What happens after? In twenty twenty five, Carol Pepper, founder
Speaker 3: and CEO at Pepper International, joins us. Now, Carol, that
Speaker 3: was a great survey that came out today that talked
Speaker 3: about our CEO confidence is smashing it. After the election,
Speaker 3: CEOs feel so much more confident about the economy, etc.
Speaker 4: Does this last?
Speaker 3: And is that optimism reflected inequities and should be?
Speaker 10: Yeah?
Speaker 1: I think they're confident for good reasons.
Speaker 10: I think first of all, the fact that we have
Speaker 10: peaceful election and there's not going to be any other
Speaker 10: problems in January is making everybody very happy.
Speaker 1: The new team is organizing, getting itself together.
Speaker 10: There are checks and balances with the minority Democrats and
Speaker 10: some of the other Republicans. So the political situation here
Speaker 10: has become very calm.
Speaker 1: That makes people very happy. There's also a commitment to
Speaker 1: keeping regulation.
Speaker 10: Low, not adding additional burdens on companies, so CEOs are
Speaker 10: justified being happy. And on top of that, the economy
Speaker 10: is humming along, inflation is under control. If you were
Speaker 10: a CEO, what more could you ask for other than
Speaker 10: a big bonus at Christmas, which a lot of them
Speaker 10: are because they had a great year this year.
Speaker 6: So what are some of the areas when you talk
Speaker 6: to your clients, your private clients here, what are some
Speaker 6: of the themes that you're bringing to bear on twenty
Speaker 6: twenty five.
Speaker 10: Yeah, Well, as you know, I run money for family
Speaker 10: offices with over one hundred million dollars and basically we
Speaker 10: look for long term try friends that will continue to
Speaker 10: do well over the whole year and even twenty twenty
Speaker 10: six and twenty seven going forward.
Speaker 1: So the big themes are.
Speaker 10: Things like global data centers, continued rise of AI.
Speaker 1: Recovery of real estate.
Speaker 10: You know, there's a lot of positive themes here for
Speaker 10: people to look at. So we're looking at things that
Speaker 10: will continue to grow in frankly a risk on environment.
Speaker 1: Of course there will be consolidations.
Speaker 10: Of course there will be down days and corrections, there
Speaker 10: has to be, But it doesn't mean that the.
Speaker 1: Overall trajectory for the year will not be up. And
Speaker 1: that's the direction that we're going.
Speaker 10: We're going to hire US markets for a whole bunch
Speaker 10: of reasons, and for that reason, the clients are happy.
Speaker 1: And they're not looking to pull back on their equity positions.
Speaker 10: If anything, down days are good times to add to
Speaker 10: positions that you know will do well over the long term.
Speaker 3: So the counter to that is that the US makes
Speaker 3: up so much now of the global markets that everyone
Speaker 3: is just so heavily allocated to that also, can we
Speaker 3: get all the things?
Speaker 4: Can we get lower.
Speaker 3: Inflation, a good jobs market, continued fed cuts, some kind
Speaker 3: of fiscal stimulus from Washington, and higher equities?
Speaker 4: Is that all reality for us? How do you push
Speaker 4: back against that?
Speaker 10: Well, I don't see any headwinds. Nobody is telegraphing very loudly.
Speaker 10: For example, Powell is not saying I'm stopping cutting. There
Speaker 10: are no big inflation numbers that are zapping people and
Speaker 10: warning the data is supporting that thesis.
Speaker 1: Right now.
Speaker 10: So obviously if the data changes drastically, if suddenly there's
Speaker 10: a run on US workers and suddenly wages are shooting up,
Speaker 10: we will hear about it. It will show up in
Speaker 10: the numbers. So right now, there's not a lot of
Speaker 10: evidence to counter the continued dominance of the US equity.
Speaker 1: Markets for that reason.
Speaker 10: As you know, I work with also a lot of
Speaker 10: non US families, and for them, this is the safe haven.
Speaker 10: Come and put your money into US equities if you
Speaker 10: wanted to grow. It used to also be US real estate,
Speaker 10: but I think right now equities are equally attractive and
Speaker 10: obviously much more liquid than US real estate.
Speaker 6: So let's go to some names. That's your Amazon, what
Speaker 6: are your thoughts there?
Speaker 10: I love Amazon because again this is a company that
Speaker 10: has many, many arms and many ways to make money,
Speaker 10: lots of revenue sources.
Speaker 1: They'll do well over the holidays.
Speaker 10: There's always a bit of grumbling, you know, will consumers
Speaker 10: shop online? And then every year we see the amount
Speaker 10: of consumers shopping online increasing relative to in person shopping.
Speaker 10: And Amazon's you know, next day delivery is fairly flawless.
Speaker 10: They're also making you know, have the Amazon Web services
Speaker 10: and have huge cloud computing capabilities they're pushing into AI.
Speaker 10: So I think Amazon is continuing to be a dominant player.
Speaker 1: And again, the big are going to get bigger. The
Speaker 1: winners are going to win more. That's the kind of
Speaker 1: market that we're in right now.
Speaker 10: This is not a market, in my opinion, to bet
Speaker 10: on the underdogs, take the stupid bet, take the momentum bet,
Speaker 10: and bet on the big winners because they're going to
Speaker 10: continue to win and certainly, you know, Amazon and Vidia,
Speaker 10: names like this are going to continue to be the winners,
Speaker 10: certainly for twenty twenty five.
Speaker 3: Okay, and dip because Amazon closed it a record high yesterday,
Speaker 3: so any dip you want to buy them?
Speaker 7: Yeah?
Speaker 10: Absolutely, I mean if you don't have them, I've been
Speaker 10: telling people to buy them for a few years now,
Speaker 10: so hopefully they did. But it's a great Christmas present.
Speaker 10: Rather than buying Disney stock, although it's very nice. Disney
Speaker 10: is a bit of a one trick, Tony. Go ahead
Speaker 10: and buy Amazon for your kids trusts or when you're
Speaker 10: doing your final gifting for the end of this year,
Speaker 10: go ahead and put some Amazon stock in the trust
Speaker 10: for all the kids and the charities, and you'll be
Speaker 10: very glad you did.
Speaker 4: So my daughter will be so excited Christmas morning. Here's
Speaker 4: Amazon stock fairness exactly, so.
Speaker 1: When she's going to college, trust me, yep, exactly.
Speaker 6: Carol, talk to us real quickly. I know you've been
Speaker 6: consistently bullish on it. In Vidia. What's your thoughts here?
Speaker 10: Yeah, I think that again they're the dominant player. I
Speaker 10: don't think anybody's going to catch them in the near term.
Speaker 10: And so again, think of if you had been smart
Speaker 10: enough to buy Amazon when it.
Speaker 1: Came out, how wealthy you would be today.
Speaker 10: So again, buy Nvidia, hold your nose at the price
Speaker 10: and put it away because it's going to be worth
Speaker 10: ten to fifteen twenty one hundred times more five years
Speaker 10: from now.
Speaker 1: So hold on to that stock. Nvidia continues to be
Speaker 1: the best play out there.
Speaker 10: Of course, others will come along, but it doesn't mean
Speaker 10: they won't continue to be the market leader, and they
Speaker 10: have plenty of cash to keep innovating.
Speaker 6: All right, Carol, thank you so much. We appreciate getting
Speaker 6: your thoughts. Carol Pepper, she's a founder and CEO of
Speaker 6: Pepper International, joining us from New York City via the
Speaker 6: zoom thing.
Speaker 2: You're listening to the Bloomberg Intelligence Podcast. Catch us live
Speaker 2: weekdays at ten am Eastern on applecar Play and Android
Speaker 2: Auto with the Bloomberg Business app. You can also listen
Speaker 2: live on Amazon Alexa from our flagship New York station.
Speaker 2: Just say Alexa Play Bloomberg eleven thirty.
Speaker 3: All right, let's get to some oil talk here. You
Speaker 3: got WTI up by two tenths of one percent. Sixty
Speaker 3: eight is where we print the news. Widely expected, by
Speaker 3: the way, as it opec plus is delaying the revival
Speaker 3: of its oil production by about three months. It's the
Speaker 3: third time it's had to defer this move as crude
Speaker 3: prices really struggle. So wanted to get a read on
Speaker 3: that with Ellen Waald, president of Transversal Consulting and senior
Speaker 3: fellow at Atlantic Council.
Speaker 4: Ellen, how unanimous was this? How what was it like
Speaker 4: for them.
Speaker 3: To get to this decision because opep plus is not
Speaker 3: as harmonious as one may think.
Speaker 11: Absolutely, it does seem as though this decision was arrived at,
Speaker 11: you know, by consensus.
Speaker 12: It doesn't seem like it was all that controversial.
Speaker 3: Though.
Speaker 11: Remember the meeting was actually supposed to happen last week
Speaker 11: or earlier in the week, so clearly they needed a
Speaker 11: couple more days to get all the ducks in a row,
Speaker 11: get everyone to agree. I would imagine that some of
Speaker 11: the tougher parties to get online might have been the UAE,
Speaker 11: because they're they've been waiting for this baseline quota increased
Speaker 11: for a while, and now they're pushing it off again
Speaker 11: by another three months.
Speaker 12: So you know, that's what That's what I imagine.
Speaker 11: Because it was all done virtually, we didn't really get
Speaker 11: a front row seat into, you know, how it all
Speaker 11: happened and what was going on. But it does seem
Speaker 11: like everyone is on board with all of these changes.
Speaker 6: Ellen. I know when we talk, you know, global crude oil,
Speaker 6: we have to have a sense of supply and demand.
Speaker 6: Heary is a commodity, what's the what's the demand model?
Speaker 6: Looking for a lot of folks out there these days.
Speaker 6: I think hence, you know it's sixty eight dollars for
Speaker 6: WTI crude, will I I just deduced it's not that great.
Speaker 11: Yeah, I think that that's probably lower than most OPAQ.
Speaker 12: Members would want right now.
Speaker 11: I think Saudi Arabia is really fine with it. I mean,
Speaker 11: would they all like oil to be higher?
Speaker 7: Sure?
Speaker 12: Of course, they would, but you.
Speaker 11: Know, we're not in like crisis territory at all right now.
Speaker 11: I do think that, you know, when we're looking at demand,
Speaker 11: it's a very it's a very sketchy picture. For a while,
Speaker 11: OPEC was having forecasts that we're showing a lot higher demand,
Speaker 11: and that was definitely what was fueling a lot of
Speaker 11: the anticipated return of this.
Speaker 12: Production to the market.
Speaker 11: The OPAQ forecast, OPEX, you know, economic team was showing
Speaker 11: a lot more demand growth that was going to be
Speaker 11: happening in twenty twenty four and twenty twenty five. Then
Speaker 11: I think materialized and I think that they see going forward,
Speaker 11: and so this is definitely a.
Speaker 12: Reflection of modifications in terms of what they think demand's
Speaker 12: going to be.
Speaker 11: I think the long term picture is still pretty strong,
Speaker 11: but right now, you know, we're really not looking at
Speaker 11: major increases in demand.
Speaker 3: Javier blast is a Bloomberg opinion columnist. He also writes
Speaker 3: the book on OPEK as well, and he had a
Speaker 3: really great column out earlier in the week that said
Speaker 3: that the number two official in the Iranian delegation to
Speaker 3: OPEC plus published commentary in his country's state run news
Speaker 3: agency on November twenty six, it was since taken down,
Speaker 3: it's taken down really fast. But he argued that OPEK
Speaker 3: plus is facing a supply glut, largely of its own making,
Speaker 3: following several years of production cuts. As we can understand,
Speaker 3: that strategy winds up supporting those that have lower input prices,
Speaker 3: like say the US or offshore drillers, and encouraged higher
Speaker 3: supply outside of the group.
Speaker 4: Is that of view that is.
Speaker 3: Acknowledged at all in any way among the doors of
Speaker 3: OPEC officials.
Speaker 11: So I think that that's definitely kind of this ongoing
Speaker 11: debate here. Is OPEK, by curbing their own production to
Speaker 11: try to support prices, is that in effect basically opening
Speaker 11: the door for all of this non OPEC production to flourish.
Speaker 11: And that's been the case basically since OPEK got started.
Speaker 11: I mean, this is not a new point that he's making.
Speaker 11: This has always been, you know, an issue. This has
Speaker 11: always been something that has been problematic, and I think
Speaker 11: that you have to when you look at it in
Speaker 11: the long you know, the kind of big picture you're
Speaker 11: looking at. Look, there are cycles and oil prices.
Speaker 12: It all goes through cycles.
Speaker 11: There's boom and there's bust, and there's higher prices, and
Speaker 11: there's lower prices, and there's always non OPEC production to
Speaker 11: contend with. And unless OPEK has a real hold on
Speaker 11: the most or the majority of the supply, they can't
Speaker 11: control the market. And a period of very high prices
Speaker 11: is going to lead to more production, you know, from
Speaker 11: non OPEC sources, and then you have periods of low
Speaker 11: prices and you're going to see some go go bust.
Speaker 12: So I think that he's making a point.
Speaker 11: He's saying that by curbing production for so long, we've
Speaker 11: supported prices enabled these other guys to produce more, you know.
Speaker 12: I think that's that's normal. They could have decided to
Speaker 12: continue to take the Ali.
Speaker 11: Naimi strategy, which was all out production, produce as much
Speaker 11: as you can and try to get these higher cost
Speaker 11: producers out of the market.
Speaker 12: I don't think that worked as well as they thought
Speaker 12: it would. It definitely has.
Speaker 11: Potential, though, So it's it's definitely a tension within OPEC
Speaker 11: that is ever present.
Speaker 8: All right.
Speaker 6: I told Alex, I'm watching the TV show Landman all
Speaker 6: about the oil business down in like West Texas. I'm
Speaker 6: learning all about this stuff. What are our friends in
Speaker 6: Texas and Louisiana and Oklahoma. What are they doing in
Speaker 6: terms of their drilling activity these days.
Speaker 12: So it's nice that you're watching that.
Speaker 11: I haven't haven't tuned in yet, but I've definitely got
Speaker 11: it on my list.
Speaker 12: I think that down in Tech it's.
Speaker 11: A totally different picture now than it was, say, five
Speaker 11: years ago, ten years ago. They're really looking at a
Speaker 11: very different picture. We've got much larger producers running the
Speaker 11: show now. We've had so many, you know, consolidations, not
Speaker 11: just of the really little guys, but also even bigger acquisitions,
Speaker 11: I mean, an excellent acquired pioneer, you know, we've got.
Speaker 12: They're much bigger players.
Speaker 11: Now, and they can afford to be more strategic about
Speaker 11: their production.
Speaker 12: So I think that in Texas now they're not.
Speaker 11: Really all that concerned about what Opek is doing all
Speaker 11: that much.
Speaker 12: Production is at a record high in the United States
Speaker 12: right now.
Speaker 11: Apparently we're thirteen point five million parrels a day of production,
Speaker 11: which makes the US.
Speaker 12: The highest producer in the world right now.
Speaker 11: And so I think that they're really looking at it,
Speaker 11: you know, in a longer term situation now, because they
Speaker 11: are larger producers and they're more established, and they can
Speaker 11: afford to whether the lows more effectively than a lot
Speaker 11: of the smaller producers could.
Speaker 4: All right, Ellen really appreciate it. Thank you so very much.
Speaker 3: Ellen will called a president of Transversal Consulting and senior
Speaker 3: fellow at the Atlantic Council, joining us there.
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