With Laurent's segle and from London and Gerard Reed from Berlin.
This is redefining energy.
Happy new Year, Gerard, Happy new year, my friend got to see you. And of course we have for predictions Michael Barnard. Happy new Year, Michael.
Happy new year to both of you.
Yeah, looking forward to this.
Well, first, as usual, we take our six predictions from last year and see who fair the best and who to't really missed it. Probably I'm going to jump right in. The first prediction is Stellentis will outsource his EV production in China.
So who did this one? That was me? Can you elaborate a bit?
Well? I think I did pretty well on this one. It didn't actually start. One of the things I had a thought on was he was going to put Prugio and Renault brands in the like stable of brands on Chinese medivs and stop pretending to be a man inside. What it actually did was establish a joint venture with Leap Motor, and it's actually importing Leap Motor branded vehicles
into Europe. The second thing it's doing it's actually established a joint venture with CATL and it's going to be established a battery gigafactory in northeastern Spain, where it has a bunch of plants and about a million people in the ecosystem, unlike Northfolk's location and eighty percent decarbonized electricity with a Spain's industrial policy which is actually reducing the
cost of industrial electricity as well. So it's actually got has many more of the conditions for success Northfolk did. So I'm feeling pretty comfortable that I got it close. Didn't think Tnaris was.
Going to go though, I am totally witches.
Yeah, you also should have predicted that the shares of Stanislos last year, so I would have been able to shot them.
So off my skill set.
If I'm going to go mark out a five, If I'm gonna give him a four L five, okay, I'm gonna do because he definitely got and even the share place falling and stuff like that, it's all relation to the fact that he basically they have to go and change their business model and so yeah, they're making progress.
Okay, So I give you three out of five because it's not just Stellontis. If you look at the results of the German main atomakers Onsagon profits went down last year by sixty four percent, D ninety one percent, BMW eighty four percent, and Massades Benz fifty four percent. So it's the all Western OEM went down. Well, it's not a crisis, it's an implosion. It's not just ste Luntist, it's pretty much everybody.
But I'm going to defend myself. I didn't make a prediction about implosion. I made a prediction about bringing Chinese manufactured evs into Europe.
Okay, Julie noted, but duly ignored. So you end up seven out of ten on this one. Next prediction, politics election in two twenty four, who derated the energy transition? That's me And I'm pretty happy with my prediction. Considering the fact that Trump has been elected and he has talked about dismantling most of the pro green policies of Biden and Journey speaking, what we've seen is that there's a much more emphasis on security than on green. So
I feel pretty good about my prediction. What's your opinion, guys?
I think maybe if you're talking about twenty twenty five, you're right.
But let's be really clear.
Twenty twenty four was a record year in terms of installations of everything renewable, whether it's solar wind evs in the United States and actually across the rest of the world. So there was no derailment whatsoever of the energy transition in twenty twenty four. So if I could give you a zero out of five, I would, But because Christmas, I'm going for a one.
I'm feeling slightly more charitable because my comment last year was no, the elections will have impacts in the following years, not next year, and so I with Gerard and the timing. The big thing that I think is going to happen is that offshore wind in the United States is dead for another five years. Beyond that, the United States will be slowed by this, but the rest of the world is just going to buy more and more Chinese products.
I'm going to give you a two because you're right in general, but you're not right on the time.
Yeah, listen, because I'm feeling charitable, and you know it's January and all this type of stuff. Be nice to people, I'm gonna raise it to a two as well.
Oh that is so nice of you. Okay, next job over.
Supply of everything energy related to and that's what we've seen, and that starts with fossil fuels, oil prices down, gas prices down. If you look in the renewables area, costs of evs have collapse, cost the batteries of collapse, cost of solar has gone down, even wind has gone down. So yeah, I expect I should be getting a five out of five out of this.
Yeah, but John, have you seen the price of the TTF. You know, up started the year at seven OPU and I is at fourteen.
There's exceptions to everything.
Yeah, there's exception to a five out of five. That's why I give you a four out of five.
Michael Well, I was actually feeling like you were just making an observation a year ago, and so I wasn't going to give grank you very high on this except for the sheer magnitude of it. The collapse in battery prices down to under fifty dollars per kill a what hour. I'm a battery optimist, and I had no expectation that we'd hit that. The massive surge in solar and Pakistan because of the glut of solar panels, no expectation of that.
I'm continue to be surprised in amaze. So while it's just an observation you made, and you didn't actually make observations about the implications of it, which is what a real prediction would do, which I'll demonstrate later. I'm going to give you four to five.
Thank you very very much.
Okay, force prediction, stronger top down governance of transmission and interconnection, Mike Kurn.
That was in the EU specifically correct. I'm just gonna say I'm feeling pretty strong about this one too. In May of twenty twenty four, to the twenty seven members state energy ministers and make up the Transport, Telecoms and Energy Council of the EU agreed to the following and I quote underlines the need for a holistic, long term, coordinated, improved and integrated electricity grid infrastructure planning at European level.
That's the people who make the decisions saying they need top down planning of grid and they need EU level coordination, not the current boys Club of utilities. So I'm feeling that this one I.
Not did it in the p I'm going to add one little bit to support to Michael, which is he didn't talk about the US, which is in the US there I also has been really strong moods towards top down governance, and.
Actually it's partially driven by energy security, but it's really been driven by data center growth and stuff like that.
You know.
So I'm definitely with your list. If I could give you a five point five out of five, I would, but I'm not allowed.
So I'm just going to give you a five out of five.
Thank you so much. So at five point five.
Five out of five, I can't give a five point five. I'm going to give him five out of five.
Okay, I write this down fight out of you realize that if you give him a fight out of five and I played smart and I give him also a fight out of five, you lose because I'm already last as usual. Yah, you're playing against your house. You're sure five out of five?
Bit stupid on that, Yeah, but no, I think he was fair enough and he had no I think it did.
I had to be scared.
Okay, I give him also five out of five.
Okay, I'm just gonna say.
I will say in my defense, I was completely shocked to be right, Okay.
Fifth to one the return of clean energy shares and if I look at the major indices like S and P Global clean energy indecks it's down twenty five percent last year. So on one hand, I got it totally wrong. Now, if I expand what clean energy is and I integrate what I would call the periphery, which means people are providing equipment, and then that would include Simon's Energy or Jeevanova, those shares went ballistick up. Yes, the core did not perform, but the periphery went extremely well.
So I asked for your mercifulness.
Well, listen, I just have one question then if you can ask it, then I give you a bonus point. Vestas biggest turbine manufacturing in the world, is how did their share price perform last year US?
Yes, minus fifty three percent twenty four.
Okay, well listen forgetting it right, I'm going to give you, you know, a mercy mark, and I'm going to give you two out of five.
I've just got to say I'm actually somewhat pleased because I'm in portfolio rebalancing time. I'm a buy and hold. I'm not a trader, and right now, my god, is it a buyer's market. If you have cash, now is the time to get in, Because Laurent, you're off on timing again. But they're starting to fix the market mechanisms that have made it difficult for some of these friends to make a profit. They're starting to fix some of
the auctions and stuff like that. But of course there is the other problem, which is that Gerard's wrong again by claiming that Vestus is the world's largest.
Right used to used to be used to be, used to be, used to be.
And so I'm once again I'm going to give you a two out of five because you're right in the direction, wrong in the timing.
I said, only lost eight percent last year.
Then of course it's nerdful.
Yeah, ushush h.
We won't talk about that. They tried to ip o that my god.
Okay, guys, So that's another two out of five. Okay, so I already have my final score. Okay, we'll talk about it later. Last but not this prediction of last year. Jihad China, we gain massive international market in win and EV's yaho.
Woa woa woa woa.
Well, first and foremost we have seen it in the wind space. So they're not just selling into their own market, they're now exporting and actually they're very close to.
Coming into continental Europe as well, which is a big base, big step forward as well in terms of ev sorry to say that the kings of EVS and what you've seen is Chinese manufacturers going everywhere across the world.
So yeah, I'm quite happy with my prediction there that they would gain international market share within.
The EVS, although eighty percent of their car export ice really yeah, you need to follow really expelled like Michael Juna, We really know what he's talking about.
So I give you a four to five job.
My observation last year was once again geord is making an observation, not a prediction, so I can't give you much because the implications of the observation is a prediction. We talked about Vesta's a share price being way off, and that's in large part because they're losing business. We talked about the European OEMs for car manufacturers losing lots and lots of business. I'll be talking a bit more about that in a couple of spaces, But those are predictions.
Saying that China is going to dominate area is where it is already dominating and is chipping everywhere except Europe, which is a retrograde market globally, is just an observation so I'm only going to give you a three out of five.
Oh, I tell you what, You're going to have trouble next year, my friend.
Oh, I'm not going to forget this.
So I've got the final results, Okay, as usual, I'm last with eight out of twenty, the next one as fifteen out of twenty, and the first as seventeen out of twenty.
And the winner is Mike bomb Out.
I now take my Nostrodamus twenty twenty four trophy, and I accept it with all humility and also tremendous surprise. I did not expect to be so right. These were aspirational hopes. Here you're twenty twenty five predictions, and they better not be vague. They aren't.
So Prediction number one, Mike kil My first prediction is.
Jale oil production will decline in the United States in the first year of the Trump presidency. And why shales into four point zero right now? What that means it's a consolidation play by global majors who have jale sites that they can develop. Jail only lasts for three years before seeing significant declines, so it is actually a technology response to demand at market prices. But the shale oil sites.
They've already taken the highest profit ones. We're now seeing the more marginal sites that cost more to develop and have lower production. The combination of China's drop in significant demand for petroleum, especially over the coming years, is precursored by, for example, the collapse of the diesel engine market in China, where LNG engines for the longest range vehicles are going
and everything else is going electric. Basically, anything that China can't electrify it putting ellen G in and it's getting that LNG from Stans. So the biggest export market in the world for patrolum is declining, and so the price of oil is going to decline. What that means is the shale of aill sites will no longer be profitable, and the global majors it owns them will develop them.
But I will say that, as you know, they opened the Mattenhorn gas pipeline from West Access to the main hubs, which means that the WA hub, which used to be discounted to the Henry Hub, now is rebalancing. So as they're going to make more money on gas, they're going to pump more oil. That's my counter argument.
We shall see in a year. What do you think, Jirod.
I think this is very close to my second PARTICU, so I maybe go the second prediction and then I'll sort of answer your question.
With this right job your ton.
So my prediction is.
That oil prices in two thousand and twenty five will hit forty dollars. And Michael, it's a little bit going on to what you're saying there as well. I'm actually going to come from it from exactly. I agree with you that we've seen probably peak oil demand in China for a start, but secondly, we've just got overproduction in Opec.
You've got five million extra barrels a day. And I also think that we're going to see in the Ukrainian situation, we're going to see some form of peace solution there and that means you could have another one million barrels of Russian oil to come on the market, and I think that's going to just push prices down. So that's my specific prediction forty dollars oil two twenty five.
Now, when you say forty is going to touch forty once ago come on or it's an average, oh touch.
I'd just like to congratulate you. I'm finally saying something that is a specific production.
My first prediction is, and it's very close to yours, is the following geopolitics, stress, supply chains and energy bonanza will bring a more innovative and better world.
And let me explain.
There are two trouble makers in the world geopolitics, Russia and Iran, and I think they are exhausted after years of funding wars and chaos. They are burning through their fossil fuel wealth with only destruction to show for. Something's gonna give. So I think that one or the two regimes are gonna go down, which mean that whoever's gonna come after is gonna threat the market. You cannot have countries run by guys in their seventies and eighties in
pursuit of imperial or teocratic dreams. But on the other hand, the supply chains are extremely cleverb You're four years timed for a new guest our bine. So if we have a huge demand of energy, is going to be through innovation and vulnoables. So sorry, it's a bit sophisticated, but that's my prediction.
Can I just make one cover. I like what you said, Laurent, and I hope You're right. There's one little issue with the three first predictions we've come up with, and that's geopolitics, because there is still geopolitics risk, and what you say doesn't happen, it could go in the other direction, and actually we actually have prices going up, we have US shale going up, et cetera, et cetera. We hope not, but I just want to just show that in.
I don't know, they lean into this one as well. I like what you're saying. I agree that structurally Iran and Russia are incredibly fragile states, and I hope their dissolution is relatively non destructive and doesn't still over their
borders too much. I remember the Syrian refugee crisis of twenty fourteen quite clearly, even though I wasn't on the beaches of the Mediterranean counting bodies, and it's the kind of thing that can cause those kinds of floods of refugees, which is heavily destabilizing geopolitically.
That's a downer, it's a total down So I hope the nextpedictions are going to be a bit more uplifting. Michael, Y'll next.
In the spirit of being uplifting. My second prediction is a blood bath in hydrogen for any energy and transportation in twenty twenty five. I'm going to start with just a little interesting thing. It's actually illegal to call hydrogen vehicle zero mission in Canada. Bill C fifty nine was introduced in the summertime, and it required truth and advertising, and it allowed private organizations to bring charges against people
who were bringing misleading greenwashing charges. As a result, all of Canada's boiling gas lobby groups and majors took all their social media down and took all their claims off their websites. But hydrogen vehicles aren't zero carbon, so you can't make them zero carbon. Well to wheel, that's going to be interesting to play them. But at least one of plug Power, fuel Cell Energy, or ballad will finally disappear.
They're treating at pennies on the dollar of their twenty twenty one peak, which was a mini blip compared to their two thousand massive peak. At least one major bus company,
Western Bus Manufactural, abandoned hydrogen fuel cell buses. Maybe Selearis Norway will stop finally stop trying to build hydrogen ferries and replace the one operational one which has double the emissions of a diesel ferry, forty times the emissions of a battery electric ferry that operates on the same route, operates slower and costs ten times as much to fuel.
And one of the major truck and bus firms that's trying to do both hydrogen and batteries is going to follow Countrine into bankruptcy, then Cool in Europe or New Flyer in North America. Is that precise enough for you?
I love it.
I love it, and I'll go along with you and that I love it. Yeah, bring it on.
Job your next prediction.
My second prediction is around installations of all everything clean. We're going to see record installations of heat pumps globally, batteries, global evs, solar panels, et cetera. And I give you an idea just in terms of numbers, because I need to be precise because otherwise Michael will get me in trouble. Right, We'll install in this year seven hundred gigawatts of solar, and I predict that we will install one hundred gigawatts
of batteries. In terms of electric cars, I'm going to put a big number out there, and I think we're going for twenty million.
There you go.
That's my last one.
It's a when not twenty million evs, which would be great. And you said that one hundred gigabat of batteries yet yeah, no problem.
Yeah, two hundred gig what hours of batteries globally, I'd say seven hundred gigs of solo.
Yeah, but when if you look at the major is going to be more difficult. And I agree with Michael that of show wind in the US's toast.
Which are not.
And I'm just please once again, Gerard, that you're learning what a prediction is. I mean, how many years have you that's been doing this? And I agree with your predictions, and I think what we'll see is the global self. We're going to see vastly more penetration there as we saw this year in Pakistan and others. Just the sheer drop of costs. It's going to be stunning to watch.
Okay, So my last prediction start with the anniversary. It was exactly five years ago that we had the famous letter from Larry Fink black Hawk, who said black Hawk put climate at the center of a seven trillion strategy, failed to act on climate, and your fired pension fund says, and the most great one everything is ESG. Now that was exactly five years ago, and what I can predict is that two twenty five, it's the disappearance of ESG climate carbon in any financial product. Guys, you're stunned.
It is a bold any financial product.
May mean you see that five percent, but the new financial product named ESG climate Net zero carbon blah blah blah. You at a moment five years ago where overnight Morning star Ric Christian two hundred fund as ESG, and I think the label is going to disappear as fast as he appeared.
And I agree with that clarification. Well, what I will say is that doesn't mean that ESG is disappearing, and that doesn't mean people investing in the space are going to lose money. There's a tremendous amount of creation of good stuff like Nesty is vastly undervalued for a company which is going to be a significant growth company over the next twenty years. So you're considering buy and hold. There's some amazing deals, as I said earlier.
Yeah, certainly, but the monika ESG is just going to vanish.
I think it's not that easy to do it over night Laurn just because you've got a bureaucracy in place in around ESG. But I'm definitely living in hope that it does disappear in twenty twenty five because I think in a lot of ways it is not helping.
A side prediction.
A side prediction is carbon capture also is going to weane because can you imagine there were five hundred carbon and capture lobbies that coup twenty nine And there was the famous interview of Diine Woods, the CEO X and Mobile, and he says, and I quote, CCS doesn't work.
I have to give the fossil fuel industry credit for this. They really know how to reuse and recycle. Every five to ten years you get another bubble of carbon capture and hydrogen for energy and coon diesel, and it's just recycling the same nonsense they peddled previously. It's actually quite efficient and effective them. I think we should have plumbed them for their circularity.
The amount of money they can expect from taxpayers is absolutely staggering. But I'm with you. I'm very interested by your prediction. And if oil touch forty donar, like Jos says, I can tell you that there's going to be some consideration, and when the company's pretty ripe for being taken over its VP, they're not going to survive if the price goes down.
One of my potential sideline predictions, I was thinking which company would I predict would disappear, which one of the major oil majors, and I chose not to go that way.
By the way, guys, I think that's one prediction we all agree on. I don't think it will survive here.
Well, gentlemen, that's it. We've done our six predictions for the year, which I'm going to try to summarize. Number one, all production down in the US. Number two old price will eat forty, develop a barrel into twenty five. Number three geopolitics stress supply chain and energy bonans up will bring a more innovative and better world. Number four a blood bath or hydrogen in transportation sector. Number five record installation of salar seven hundred giga, what batteries two hundred
gigo what hour? And evs twenty million? And the last one n of esg climate carbon in the financial product. Gentlemen, So with a pleasure predicting the future with you, I'm sorry I lose every year loose all the time.
Things can only get better.
Yeah, that's what we say every year.
As the new defending champion, all I can say is I'm surprised, but I'm the defending champion, and I'll be surprised if I actually managing to friend my crown.
You have no chance this year.
I'm telling you, I'm.
Just I will bid up the oil market like you have no idea. So just a jahwe on this one. Because job, this is a prediction of five or zero. You can't be half right on this one.
Yeah, I know that's true.
That's true.
That's true.
Okay, And if we reach nineteen point nine million evs and not twenty same zero, guys, great being with you. We thank our listeners. Be ready for a great tour twenty five. We love you all.
Happy to hear everyone, and the future is so bright. We gotta word shades.
Well said, well said, Good luck everybody.
Thank you for listening to Redefining Energy.
Don't forget to rate the show and subscribe on Apple, Podcast, Spotify, or the platform of your choice.