Can last year’s hot Energy Sector regain its mojo post the Fed?

The market’s ongoing belief that the global economy is moving toward an inevitable recession combined with China’s fairly muted growth targets for 2023 has sent energy prices tumbling from their dizzy highs just one year ago e.g. Brent Crude is trading 45% below where it was this time last year. However, we are conscious that stocks often lead major tops/bottoms in their underlying commodity prices, which in turn generally run 6-12 months ahead of the economy hence we are starting to look for clues that  “enough is enough” on the downside for the energy complex.

• We believe the world will transition away from fossil fuels at a slower rate than most people hope which will provide solid short to medium-term support for the likes of oil and coal.