Khee Bhoared Scheephe

People don’t really understand how obscenely large the oil and gas industry actually is. Worldwide oil revenue is $4 trillion per year. Every year the oil industry collects more money than the US government. Not the US military, the entire US government. Every year the oil industry allocates $850 billion of capex to new projects, and those new projects increase the oil supply by about 1.8%. It costs half a trillion dollar a year, for every 1% of growth. Meanwhile, people think the $500 billion datacenter buildout is “unprecedented”. A year with $500 billion capex means a downturn and mass layoffs in the oil industry. It’s just a different scale. The same industry sells $2 trillion a year of gas. So $6 Trillion of revenue in 2025, and projected $8 trillion of revenue for 2026. There is a reason that the world has multiple “petrostates” with huge sovereign wealth funds, but no other type of mono-economy country with giant trillion dollar liquid funds. Many countries, such as Saudi Arabia produce oil and gas at 70% profit margins. So huge volumes and huge margins. That’s how you build multiple multitrillion dollar sovereign wealth funds that own a meaningful chunk of all global equities. These countries make huge equity returns in times of stability and huge oil returns in times of volatility. My point here, is that the datacenter capex can go much higher. It’s currently $6-700 billion, but for a major boom it could be double this. And the “oh noe! We need lots more datacenter plumbers!” is just a complete joke, when there’s an industry 10X bigger that literally does nothing but lay pipes everywhere. Embarrassing ignorance. Hyperscalers are still only using cashflow, and still each sitting on $100 billion cash reserves. They need to get off the pot and go and build some stuff, because it’s difficult to take them seriously watching them flap about in “hardware” aka heavy industry, for their fourth year.