Talking industrials, materials, and energy with Peter McNally - Alpha Trader podcast

Alpha Trader

This week’s Alpha Trader podcast features hosts Aaron Task and Stephen Alpher talking with Peter McNally, Global Sector Lead, Industrials, Materials & Energy at Third Bridge.
Speaking a few hours after the OPEC decision to gradually boost production in coming months, McNally notes oil (CL1:COM) inventories have been falling since early last fall, thus making the OPEC move a logical one. Even with the boosted production, McNally expects inventories to continue to fall through Q2.
As for prices, McNally says since supply is being so well-managed, it’s all about demand. If global economies continue to reopen, crude could be headed to $70, but if the renewed lockdowns currently taking place in parts of Europe become a trend, oil might retreat back to $50.
But what about the potential of more U.S. supply coming online? It’s not as easy as flipping a switch, reminds McNally. He expects it would take three months of oil in the $60s, and then another six months after that to restart much of the domestic drilling that was lost over the past year.
There’s plenty more, including why gasoline prices might rise even if oil prices flatten out, whether Deere (DE) is now a space-exploration company, and an early take on possible winners/losers from the president’s multi-trillion dollar stimulus proposal.
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