Hexun Investment Advisor Bao Jian: Will Oil and Gas Continue to Rise? Has the Era of Cyclical Dominance Arrived?

Cyclical commodities must be watched, especially those involving oil and gas, coal, chemicals, and energy. Why do we have this logic? According to Hou Baojian, a senior analyst at Hexun Investment Advisory, first, what is the essence that initially drives the rise of commodities? It’s computing power. Remember last year there was a popular saying online? Computing power and national strength. The end point of computing power is electricity, so the starting point of the entire cyclical price increase is the demand for computing power. And where is the end point? The focus is on energy. Smart friends, you must know why oil and gas prices have risen recently. So some might ask, is it due to geopolitical conflicts? Not exactly. Geopolitical conflicts are just the icing on the cake for oil and gas prices; they are not the main reason. In other words, even without these conflicts, prices would still rise if they are supposed to.

The second reason is that globally, supply chains are experiencing some imbalances—some regions are lacking various energy sources, which naturally causes prices to rise. And with the added conflict, it’s even more pronounced. The third point is something I often emphasize: we are in a global monetary easing era. The previous cheap prices, let’s say, are no longer achievable in the short term. Based on these three points, believe me, the oil, gas, coal, and chemical markets you hold can still go up.