Steve St. Angelo: Energy Cliff to Spur Next Move Higher for Gold and Silver
The energy situation across the globe is growing increasingly precarious, and gold and silver are among the assets that look set to benefit as conditions worsen.
Speaking to the Investing News Network, Steve St. Angelo, independent researcher at the SRSrocco Report, explained the concept of the “energy cliff,” noting that energy is the main driver of the economy.
He noted that conventional oil production started to peak in 2005, after which debt was used to bring on a slew of unconventional production. However, now unconventional output also appears to be approaching a peak.
At the same time, said St. Angelo, energy storage levels are declining globally.
“If they continue to trend lower, that means we have reached — I call it the ‘energy cliff’ or peak of production, not only of oil, but of also of natural gas and likely coal soon thereafter,” he said.
Relating these ideas back to precious metals, St. Angelo said that there could be a wave of disinflation in 2022, and if that happens he sees gold and silver prices weakening by the end of the year.
But in 2023 or 2024, the energy cliff will rear its head, sparking the next move higher for gold and silver.
“Unfortunately we’re not going to have another roaring ’20s. I think actually we’re going to start — by 2025, that’s my year when the world is going to start going over the energy cliff. So it’s going to be actually much different than most people realize,” he said during the interview.
Unlike stocks, bonds and real estate, which St. Angelo described as “energy IOUs,” gold and silver represent stores of energy value. “My analysis suggests that as we go over the energy cliff, the best stores of energy value — if the most important factor is energy in our economy — are gold and silver,” said St. Angelo.
Watch the interview above for more of his thoughts on energy, gold and silver.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.