A Comment -- General Comments From an Expert (A Commentary)

At this point, no. Seeing pullbacks, which are normal and healthy. A pullback is defined as a decline of 5-9%, and they happen 3-4 times a year. 

Correction is defined as a decline of 10-20%. Those happen about once a year. 

Yes, these moves can create uncertainty. And that's the one thing that markets don't like. If we can get clarity or any sort of guidance that a peace deal will form, she can see markets taking off very quickly.

If the conflict is prolonged, that could create sticky inflation and cause interest rate cuts to be pushed down the road. We're not there yet, but she's certainly watching the impact on the economy.

Still likes it. The story has gone from more of a cyclical metal to a strategic asset -- electrification, data centres, EVs are all copper-intensive. We're headed into a structural supply deficit. That macro backdrop makes the whole space really compelling.

One of her favourite long-term themes.

She does hold cash, about 7-11% right now. If energy prices cause an economic slowdown or inflation becomes sticky, the current 7% market pullback could turn into 15-20%.

It depends on your equity exposure and risk tolerance. Would be a good time to start strategically picking up some international exposure, value names like financials, materials. But don't overpay for those things. Some stocks are down 15-30%, lots of opportunities out there to pick up half positions now.

She looks at fundamentals for what businesses she wants to be in. Use technicals to determine your entry point. For new $$ today, clients get 50-60% of their total equity target now; if someone's already at 50%, she'd have them up to 75%.

Go in by tranches/stages. If we're heading into a double-digit correction, it could be the only one we get for 2026.

That's right, yet we're living through the worst energy crisis in our lifetimes (even taking into account the 1970s). The complacency still in the oil market is astounding.

Let's put things in perspective. Middle Eastern production is down almost 11M barrels per day. Flows out of the Strait are down ~17M barrels per day. The last of the ships that were able to exit the Strait have now reached port.

So you're now starting to hear stories such as 500 gas stations in Australia shutting down because they've run out of gasoline. Some fish markets in Asia have no fish on the shelves because it's not economic for the fishers to go out anymore.

The real effects are just being felt today. The situation is dynamic, but if the Strait remains closed, and you look out 2-3 weeks from now, we will lose throughout 2026 (based on data from Energy Aspects) approximately 920M barrels of Middle Eastern production. That's more than we lost during Covid (so far the biggest demand shock in history).

The benchmarks don't yet reflect reality. Reality will hit very soon in the coming days and weeks.

We need to reach an oil price within about a month where you kill demand, because you're depleting stockpiles so quickly. Strategic petroleum reserve (SPR) releases are, at most, 4M barrels per day (but production is down 11M, and flows are down 17M).

There's no policy change you can enact to offset this mismatch. Once the SPR release is over, that's when it really blows up. To restore balance, you have to kill demand. Unfortunately for the global economy, the oil price for that is a shockingly high number of roughly $175 per barrel (when oil price reaches 5.5% of global GDP).

We're using up the safety buffers -- strategic releases, onshore storage, offshore storage. Those are all ending in the next several days to weeks. That's when the paper market will reflect the physical market.

There's all this talk that Trump will TACO this weekend, and everything will go back to normal. There is no normal to go back to. Consensus was that 2026 would face the biggest oil glut in history, and oil would fall to $40. In the next 3 weeks, inventories will go to multi-year lows because we've lost so much production. 

That resets the floor for the price of oil when this ends. He calls this "the day after". What does that look like? It'll take at least 3-4 months to bring back production in the Middle East, even if peace breaks out on the weekend and oil sells off. There will be a long-term $10-20 premium on oil that the world will have to put up with.

His view is that whatever you want your energy weighting to be, you want maximum weight right now. Things continue to get worse by the day, not better.

The worst energy crisis of our lifetimes. In the coming days and weeks, prices of WTI and Brent will need to better reflect reality.

You have to have a macro view -- incredibly challenging for DIY investors. Portfolio managers spend a lot of time and $$ to obtain global perspective. Then you need to decide if you want to be in drillers, refiners, oil, natural gas, etc.

The global LNG perspective has changed dramatically in just the past month. There was supposed to be this massive glut going out to 2029. Now with Qatar being hit, 20% of global LNG supply is offline right now. They say it'll take 4-5 years to rebuild, which translates into 17% of capacity. 

That means the world's lost 3.5% of global LNG for at least the next 4-5 years. Disaster. There's no strategic reserve for natural gas.

He has zero natural gas in his fund. Domestic natural gas fundamentals really eroded. There's too much supply. More oil drilling also produces gas alongside. You want to be all in oil right now.

We need to get meaningfully higher, and the challenge is time. Time is not on our side. Building a 1M-barrel-per-day pipeline to the West Coast takes roughly 8 years.

US and Canadian governments are in discussions about resurrecting Keystone 2.0. Great because the timeline is a lot faster. Not great because it ensures customer concentration risk with the US, and we've been trying to move away from that.

We should be doing both. We're approaching full capacity, which is an issue. Global demand is roughly 106M barrels per day, anticipated to grow to at least 150M by 2050. Meaningful growth in US is over. Non-OPEC production is peaking this year, OPEC has 1.5M barrels per day spare capacity and then they're done.

Where are the necessary barrels going to come from? Only a handful of countries are on the list, and Canada's at the top. We're the only country in the world that can't get out of its own way to build extra capacity. It's economic treason.

The world loses 7M barrels per day of productive capacity due to well decline. The very-well-respected minister of energy for Saudi Aramco has been warning the world for years that it needs to invest more. He can see what's coming, and that was pre-Iran.

We're in an opportunity-rich environment. Almost every oil stock is a Buy today. The value in hiring a professional to help you is that you go from being up 20% on your own, to being up 80-100% or more with a professional manager.

In general, political events have (at best) a temporary effect on the market. The defining political event of his adulthood was 9/11. Yet markets closed higher at the end of 2001 than they did on September 10, 2001. Markets tend to take things in stride and then move on fairly quickly.

There's conflicting information coming out of the Iran situation. Iran is saying they're not having any discussions with the Americans. Trump is saying he's talking to "Top. Men." (just as in the last scene of Raiders of the Lost Ark). Of the two, Brendan actually believes the Iranians; yet the market seems to be accepting the reassurances coming out of the White House.

As the wise New York philosopher, Paul Simon, said, "A man hears what he wants to hear and disregards the rest."

He's pretty heavily weighted in energy, especially Canadian energy, but hasn't trimmed. It would have been really nice if Canada already had in place the business case to get more of our energy to world markets.

As the wags are saying on the internet, "The difference between this conflict and the Vietnam War is that Trump knew how to get himself out of the Vietnam War." 

This will continue on in some way for a bit. Even if it doesn't, the bigger problem for energy prices would be if there was a slowdown in the economy driven by higher interest rates. The president would very much not like rates to ratchet up in the 6 months before the midterm elections. 

The US being able to keep interest rates low is more of a determining factor than whether this war continues on.

Still heavily weighted in energy, especially Canadian. Financial services have been a bit weaker here, but he likes them and they should continue. As for AI, we'll probably talk about some of the most boring companies in the tech sector during his Past and Top Picks.