Eric Nuttall

Highlights from my testimony to the House of Commons’ Standing Committee on Natural Resources - opening statement

A few thoughts with oil down 11% on the SoH being "opened" (until April 22nd): 🛢️voyage time for tankers out is ~25 days to Asia and 25 days back = ~ 2 months of continued production loss = ~600MM Bbls = still heading to lowest inventory levels in history 🛢️IEA yesterday saying will take ~ 2 years to fully normalize production 🛢️80 facilities have been damaged, 1/3 "severely or very severely" which will take quarters/years to fix 🛢️political risk premium of $10+/bbl likely and the floor price for oil is now higher given inventory reset 🛢️SPR restocking will = ~0.3MM Bbl/d of new demand for the next 4 years 🛢️oil equities were on average discounting $70WTI. Won't matter at the open but will again soon.

Every month the Strait of Hormuz remains "closed" the world forfeits 360MM barrels of production. Put another way, each monthly loss of 12MM Bbl/d reduces supply by the equivalent of a 1MM Bbl/d ANNUAL loss. Very important to understand.

Spending an hour with Bob McNally of Rapidan, a trusted advisor to our energy funds, is a crash course in geopolitics and energy realism combined. Few (if any) have called the US/Iran situation better, and we are in total agreement with what is coming in the days ahead.

Complacency we believe = opportunity, and these are examples of significant holdings in the Ninepoint Energy fund, of which the ETF series trades under the ticker "NNRG." ninepoint.com/funds/ninepoin…

Or another midcap CDN oilsand producer, with 50+ years of stay-flat inventory, growing production by 45%/4 years while still generating enough FCF at $80WTI to pay a 9% special dividend a year (+3% base dividend):

We believe the floor price for oil is higher than the "old normal" and in that is enormous opportunity. Here's one: a CDN oilsand producer with 40+ years of inventory, growing production by ~75%/4 years while able to buy back 40% of their shares outstanding:

Politicians who use terms like "futureproofing" and "social license" display a dangerous level of energy ignorance. The world is begging for more Canadian energy and not a single purchaser cares about a barrels carbon footprint. Time to move on from economic self-flagellation!!!

Energy crisis...what energy crisis?!? Markets are at all-time highs and meme stocks are back! What are these energy guys on Twitter talking about???

Let's just go there...the Strait "opens" today. What does it mean??? 🛢️global oil inventories will still go to record lows 🛢️we will still lose over 1BN barrels of production 🛢️refined product shortages/outages will persist for several quarters 🛢️SPR restocking will = ~0.3MM Bbl/d of new demand for the next 4 years (33% boost per year) Meanwhile, US shale will still be in its twilight, non-OPEC production will still be peaking, and OPEC spare capacity (adjusted) will still only be ~1.5MM Bbl/d, and whose value is less today than before given the potential for another disruption down the road. We are not going back to the old normal...expect a higher floor with an embedded political risk premium. The market may think the crisis is over...it's not.

I've met with several major oil producers over the past few days. None of them are intending on increasing their 2026 capex programs, which means the meaningful increase in free cashflow will largely go towards share buybacks...the only upside to the recent sell off in equities.

It took Isaac Newton's groundbreaking Principia Mathematica 50 years to become consensus. For energy investors, it feels like a similar timeframe for the oil paper market to better reflect the biggest energy crisis of our lifetimes. Imminent shortages = forced reality check!

Energy fund managers say cheap oil unlikely to return even after Iran war ends theglobeandmail.com/investing/glob…

There is no "old normal" to go back to. We'll have lost over 1,000,000,000 barrels of production, taken inventories to all time lows, created ~0.4MM Bbl/d of new demand via SPR restocking, created a $10+/bbl risk premium, + damaged facilities and potential reservoir damage.

Key update: what does "the day after" look like and what does it mean for energy investors?

The world is about 2" away from hitting the wall at full speed and most can't even seen it coming. Imminent energy shortages in parts of the world and for the rest, significantly higher prices. The battle for the physical barrel has begun.

This brought me joy last night. It can for you too. The ETF series of the Ninepoint Energy Fund trades under the ticker "NNRG." ninepoint.com/funds/ninepoin…

Middle Eastern production is down 13MM Bbl/d, and every week the SofH remains "closed", the world loses 91MM Bbls of production. Even with the biggest SPR release in history and run cuts, the inevitable looms.