Peak Oil, Construction Spending, Equity Sentiment
October 6, 2023 | FIRESIDE CHARTS
The International Energy Agency (IEA) revised their oil demand forecast to a new all-time high, surpassing the prior peak in 2019. The price of oil has displayed its signature volatility of late, rising steadily in throughout the third quarter and falling rapidly the past week or so. Gasoline prices didn’t follow oil up in lock step, but they may follow it down. The economy is still chugging along, in part due to continued strength in the construction industry. Used car prices. Historically defensive equities. Global monetary policy. Equity sentiment.
1. Despite proclamations of “Peak Oil,” demand is still rising and is expected to continue to do so in the coming years:
Source: The Daily Shot 10/2/2023
2. The rapid price changes in the price of oil make it difficult to invest confidently in the sector:
Source: 10/6/2023
3. Wholesale prices of gas lead retail prices, but the lag may be longer when prices are falling:
Source: Pantheon Macroeconomics
4. Inflation adjusted personal spending reached a new high:
Source: The Daily Shot 10/2/2023
5. Increased manufacturing investment is picking up the slack from lower residential construction spending:
6. Used car prices has remained surprisingly strong due to the constrained supply of new cars:
7. Historically defensive equities, such as the utilities sector, have performed poorly in the recent equity market drawdown:
Source: The Daily Shot 10/2/2023
8. We’ve likely reached the end of the global hiking cycle:
Source: Truist Advisory Services
9. Investor sentiment has fallen sharply from its recent peak:
Source: Yardeni via The Chartbook #295
Disclosure: The charts and infographics contained in this blog are typically based on data obtained from 3rd parties and are believed to be accurate. The commentary included is the opinion of the author and subject to change at any time. Any reference to specific securities or investments are for illustrative purposes only and are not intended as investment advice nor are they a recommendation to take any action. Individual securities mentioned may be held in client accounts. Past performance is no guarantee of future results.