O&G Prediction Emerges

News headlines tend to focus on what’s happening right now. But as investors, we need to try to think about what could happen NEXT.

This is what I wrote to my paid readership group on Tuesday, 24 February, just four days before the US and Israel declared war on Iran:

There’s been plenty of ‘flexing’ by the US military under Trump’s leadership. But does this signal something bigger?

Let’s hope not, but the market doesn’t seem to be pricing any risk at all. Crude is up slightly in recent days, but still consolidating around its cyclical lows.

As I mentioned, global markets are still just a whisker away from all-time highs. And that’s despite Iran, a country that’s of key strategic importance to China, being under intense pressure from the US to surrender its uranium enrichment program.

There’s a lot that COULD go wrong, but at this point, the market perceives that nothing’s likely to materialise from the US military build-up.

Then, two days after the war broke out in the Middle East, I followed up with this update:

So, is this just another Middle Eastern flare-up, tripping up markets for a few days before they glide back towards new all-time highs?

The regular playbook on how this has unfolded in the past would suggest that’s the most likely outcome.

China: The Big Unknown

But as I detailed last week, Iran matters to China. According to Reuters, China imported up to 1.48 million barrels per day (bpd) from Iran in 2025.

That represents over 80% of Iran’s total crude exports and about 13–15% of China’s total seaborne crude imports.

No small measure. Clearly, an attack on Iran threatens China’s oil supply, and undoubtedly, that will create friction on the global stage.

Could China make moves and start to play a more assertive role against US adventurism in the Middle East?

China recently sold Iran a stockpile of Kamikaze drones, and according to a recent report by Reuters, it is also looking to supply the country with state-of-the-art anti-ship cruise missiles.

These supersonic missiles have a range of about 290 kilometres and are designed to evade shipborne defences by flying low and fast.

Clearly, this would present a very different scenario for the US Navy, something it has never faced in previous Middle East excursions.

So, from here, the ball sits in China’s court. How will it react to America’s latest incursion into the Middle East?

Will Trump’s dangerous gambit pay off, or will China put a check on US military adventurism?

As of writing, we don’t have an answer yet.

But as I keep reminding you, there’s one very clear path you should be taking as an investor: Own Commodity Stocks.

Clearly, energy stands out. And that’s exactly what I’ve been shouting from the rooftops at Mining Memo over the last few weeks.

Here’s a recap of four oil and gas editions that I issued in February (alone), trying to spell out this opportunity as clearly as possible:

Weaponising Energy: What Happens When Buyers Lose Their Leverage

Tech Hits a Wall—Energy Breaks Out

Oil Services: The Leveraged Play on Energy’s Next Move

Only One Trade Matters: Oil

Since those pieces were published, oil and gas stocks have erupted onto the global stage. And if you took action, you should be sitting pretty.

That’s the advantage of thinking differently and ahead of the herd.

Until next time.