What this covers
Doomberg does not mince words when describing the energy situation in Europe and he believes that unless they reconcile with Russia and once again gain access to affordable natural gas and oil, it will ultimately mean the demise of the EU as their economy grinds to a halt. Doomberg also discusses why Ukraine can't win the war, his thoughts on the gold and silver markets, why tin is making a comeback, and much more.
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00:00 Introduction 00:45 Energy Crisis to Destroy the EU 04:17 Is This All By Design? 08:25 Ukraine Can't Win the War 14:23 Upcoming U.S. Election 17:19 BRICS and Gold-Backed Currency 20:41 Outlook on Silver 22:34 Catalysts for Nuclear & Uranium 25:34 Natural Gas and AI Data Centers 30:33 Investment Thesis for Tin 33:12 Escalating Conflict and Oil Prices
#energycrisis #oil #naturalgas
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Doomberg argues that Europe faces economic collapse due to energy dependency without Russian fossil fuels or substantial domestic production, while AI's energy demands will drive natural gas and nuclear adoption globally, with geopolitical tensions unlikely to escalate into broader conflict due to mutually assured vulnerability.
- EU consumes 10% of world oil but produces 0.5%, making it an energy vassal unable to maintain industrial and military power without reliable energy sources
- Natural gas will serve as the critical bridge fuel for AI data centers before nuclear capacity scales, benefiting North America while disadvantaging Europe dependent on LNG imports
- Iran's demonstrated ballistic missile capability creates mutual deterrence with Israel, making further escalation economically irrational despite geopolitical tensions
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Global nuclear energy adoption is accelerating, with a landmark meeting during Climate Week where 14 of the world's largest banks agreed to treat nuclear with the same favorable financing and sustainability profile as wind and solar, representing a fundamental sea change in nuclear finance.
“14 of the biggest banks of the world got together and decided or proclaimed um at the urging of no less than John podesta the US climate are that nuclear energy be treated and financed with the same favorable sustainability profile as wind and solar and that's a sea change um unimaginable that that would have had occurred when we started writing doomberg just three and a half years ago”
Project financing is fundamentally a confidence game where deals transition from undersubscribed to oversubscribed once major institutional actors signal willingness to back them, and this creates a cascading effect where pension funds and other institutional investors rapidly deploy capital.
“one of our favorite Expressions which um I wish I could remember who taught it to me but it comes from the Venture Capital World which is um all the deals are undersubscribed except for the ones that are oversubscribed and financing uh be it startup financing or in this case project financing is nothing but a confidence game”
Nuclear power plants are permanent investments lasting 80-100 years or indefinitely if properly maintained, making them fundamentally different from temporary energy infrastructure and among the best long-term returns available.
“once you have a nuclear power plant unless you're the Germans and you're stupid um it's good for 80 years 100 years I mean these are forever Investments um if you properly maintain them and and most people do um you could run them basically Forever The Only Exception to this is the British um from a technology perspective but the Germans was just you know self- impalement um you can keep running these plants for a very very long time they're the ultimate set it and forget it trade”
Iran demonstrated ballistic missile capability on October 1, 2024 by launching dozens of missiles at Israel, with multiple missiles penetrating Israeli air defense systems and striking near Israeli Air Force Base and Ministry of Defense headquarters, contrary to Western assumptions about the effectiveness of Israeli air defense.
“we observed with everyone else on Twitter the Iranian attack on Israel on October 1st um with some surprise um we saw with our own eyes various you know uh amateur films of the event directly published it which is what makes Twitter great right when you have one of these events unfolding you see raw data sometimes the occasional signal uh with no censorship no Spin and we saw what everyone saw which is dozens of missiles striking Israeli territory and very little in the way of the much Ved Israeli air defense system knocking these missiles down um and even the Washington Post a few days later was forced to admit or concede to this reality that dozens of missiles had gotten through and struck a major Israeli Air Force base and a couple of missiles even struck quite near to the Mad headquarters apparently”
Natural gas cannot be given away indefinitely; market participants will necessarily find uses for clean-burning, cheap hydrocarbon even if only to maintain oil production (gas is co-product in Permian oil).
“you can't have the cleanest burning hydrocarbon being given away indefinitely um people will find use for it um if for no other reason that they must find use for it in order to keep oil production going in the perian for example because it's a co-product and the gas to oil ratios in the peran are very high”
Russia is not merely a gas station disguised as a country but rather a sophisticated nation-state with excellent education, advanced technology and manufacturing sectors, and a track record of defeating invading armies across centuries of history.
“Russia is a very sophisticated country that has defeated uh armies as they roll from uh east to west multiple times uh and this is in their mind just the latest example of them having to do that”
Even if Elon Musk were tasked with cutting government spending at the rate he cut Twitter employees, he would find government restructuring vastly more difficult than managing a private company, because government employee unions have created legal frameworks and sympathetic judges that make terminations nearly impossible without authority the president does not possess.
“we would we would suspect that he would find this new challenge to be significantly more formidable than completely owning your own company and firing everybody um that you deem fit this is not how you know the the government employee unions have created laws and have judges in place and so on that make it almost impossible to fire somebody would require um substantially more Authority than even the president of the United States has granted um as a result of winning an election”
Russia is a formidable global energy superpower with outstanding technology and manufacturing sectors that are systematically underestimated by Western analysts who possess techno-arrogance and dismiss Russian capabilities.
“Russia is a global energy gig of power it has outstanding Technology and Manufacturing sectors which are often under estimated in the west um we have been boning this relative techno arrogance that we see amongst predominantly Western analysts who just you know um assume that Russia won't be able to run its own oil wells or natural gas production facilities without the help of Western you know um suppliers um this is nonsense anybody who has any IND you know international business experience knows that Russia is a formable competitor um they have excellent education”
You cannot be serious about carbon emissions reduction while opposing nuclear energy, creating a logical inconsistency in climate advocacy that has been resolved by major institutional actors recognizing nuclear's indispensability.
“there's been many many voices calling for for this that you can't really be serious about carbon emissions and be antinuclear at the same time um and so I think finally we're getting to where physics dictates we have to go”
The European Union consumes approximately 10% of the world's oil but produces only 0.5% of it, creating a structural energy dependency that prevents economic and military power projection regardless of renewable energy adoption, because the laws of physics dictate that you cannot project economic and military power if you are an energy vassal reliant on others for energy supply.
“the EU consumes something like 10% of the world's oil uh but produces only a half a percent of it um it's similar numbers for natural gas”
The tin market is likely to experience supply stress and price increases due to the largest tin mine in the world (located in Myanmar's Wa state) being closed for over a year, with no clear reopening timeline despite earlier assumptions of brief disruption.
“we have the largest mine fort in the world in what used to be known as Burma um and that mine has not been producing for more than a year um the country is undergoing civil unrest um ongoing Civil Wars there it's a really tragic story you know sandwiched between India and China this particular mine is in what's known as the the W state right next to the Chinese border and uh when the uh entity that controls um that state which by the way the US is sanctioning uh the United W State army or wwsa um last April they announced that the mine would be closed indefinitely because of safety concerns and permitting issues people assume that this would last a few months and that you know the global pin stocks would be able to make up for any shortages U but the mine is still closed and nobody quite Knows Why”
China is constructing nuclear reactors at a fraction of the cost required in Western nations and will establish multi-decade economic advantages from having done so compared to slower Western nuclear deployment.
“The Chinese are cranking these reactors out at a pittance compared to what it cost to build them in the west and will establish a multi-decade economic Advantage for having done so and and the quicker we could get going on this the better”
Very few Western investors have meaningful exposure to gold in their portfolios, and this structural underinvestment makes gold a valuable hedge against scenarios involving social cohesion and economic crises.
“very very few Western investors have any exposure to Gold that matters and so um you know social cohesion and economic crises and so on”
The conventional narrative on Middle East oil risk underweights the strategic implications of October 1st and overweights escalation probability, creating an opportunity to fade the risk premium in oil prices.
“our assessment of the Contemporary reporting of the potentiality of this outcome does not give sufficient weight to the consequences of what transpired on the 1 of October this year and if we're right um and we could be wrong and as I said at the beginning of this answer perhaps even spectacularly so but if we are right then we would fade risk of escalation because we would assume that um both sides would realize that it's in neither side's interest to directly escalate in know war with each other”
NATO is currently being handed what amounts to a defeat on the battlefield in Ukraine, with momentum clearly not on the side of NATO and Ukrainian forces, contrary to Western media narratives that emphasize Ukrainian success.
“NATO being handed what amounts to a defeat on the battlefield um the sanctions as we predicted weeks after they were levied were all but designed to not only fail but backfire”
Russia's targeting of Ukrainian civilian energy infrastructure (power plants, district heating, electricity) constitutes war crimes and is designed to force significant migration out of Ukraine during winter, not merely to disrupt weapons production.
“we have openly described and believe are war crimes um Russia has targeted and knocked out much of the civilian energy infrastructure all across Ukraine the Russians would say that this electricity is used to produce weapons and makes it a fair Target but disproportionately this is going to fall hardest on the people of Ukraine and if it's an especially tough winter luckily last winter was mild um if we have a tough winter in Ukraine if you don't have electricity and District heating it's very difficult to imagine that we don't see significant migration out of Ukraine um which I believe is is the point of those targets targeted strikes on the energy structure”
Russia possesses more manpower, more weaponry, more capacity to manufacture its own weapons independently, and has developed substantial technological advances since the start of the Ukraine war, all of which are bearing fruit on the battlefield and offset Western supply chain advantages.
“Russia is a global energy gig of power it has outstanding Technology and Manufacturing sectors which are often under estimated in the west um we have been boning this relative techno arrogance that we see amongst predominantly Western analysts who just you know um assume that Russia won't be able to run its own oil wells or natural gas production facilities without the help of Western you know um suppliers um this is nonsense anybody who has any IND you know international business experience knows that Russia is a formable competitor”
Political support for continued tens of billions of dollars in military aid to Ukraine is difficult to sustain given that the US is not on a wartime economic footing while Russia is, raising questions about whether adequate stockpiles even exist to supply Ukraine.
“it's difficult to imagine that the political support needed to keep tens of billions of dollars worth of Weaponry going into Ukraine whether we even have stock Pals to give is a different question um we're not on a war economy footing but Russia is”
The US is running approximately $1 trillion in debt every 90 days with annual interest payments now reaching $1.2 trillion, essentially functioning as a Ponzi scheme where the global reserve currency is printing to pay off interest rather than through earned revenue.
“I don't think it's print or die because I don't know how we get out of a trillion dollars in debt every 90 days and a trillion two now in annual interest payments you know it's uh we're going to run a very interesting experiment where the the global Reserve currency um is printing its way out of debt printing its way to pay off its interest actually which which is essentially a Ponzi scheme”
Human progress continues directionally upward as evidenced by global energy consumption growing at 2% annually over extended periods, suggesting that even if malicious forces attempt to reverse this trajectory, underlying human effort will overcome them.
“the upward direction of human progress is not something we would bet against um as shown in the global energy consumption graphs that just keep going up and to the right at 2% a year uh forever”
Doomberg's analytical approach aims to be objective analysts rather than advocates, examining market dynamics without predetermined bullish or bearish biases, and showing reasoning transparently while remaining willing to pivot based on new evidence or market reality changes.
“we strive to be analysts and not Advocates and so while we study energy markets thoroughly we're not cheering for them to go up or cheering for them to go down we're trying to do our best to understand the Dynamics at play um to the best of our abilities and to write honestly about our beliefs showing our homework and admitting when we're wrong um and I think that's um a different product some people like a day trading product some people like to have their biases confirmed that's not what we do um if we think oil is going to go up we'll explain why we think oil is going to go up and and again show our homework and if we think oil is going to go down or oil shouldn't be where it's priced we we'll explain and and then we're not afraid to Pivot based on either learning why we got something wrong or the market reality is changing”
Energy is an incredibly important macroeconomic variable that is severely underutilized in analytical mental models, with most analysts and observers intuitively recognizing energy's importance while failing to incorporate it as a foundational aspect of their frameworks for understanding the world.
“one of the things that we find interesting about macroeconomic analysis is despite the fact that most people intuitively know that energy is an incredibly important variable to study very few people include energy as a foundational aspect of their mental models to that they use to try to understand the world”
Israel is strategically vulnerable to ballistic missile attack due to its small geographic size (roughly New Jersey), modest population (roughly 10 million), and critical infrastructure concentrated in only 10 facilities: 5 power plants producing electricity and 5 desalination plants producing 80% of drinking water, all of which are publicly known and geographically fixed.
“Israel is vulnerable in several important ways first of all it's a very small country as we know it's roughly the size of New Jersey and has roughly the same population as New Jersey but its energy and its domestic water infrastructure are actually you know their electricity is produced predominantly in five power plants and it's desalinated water which accounts for 80% of the drinking water in Israel the developed water in Israel um is produced at five desalination plants and all these 10 facilities are ground everybody knows where they are”
Neither the Trump nor Harris administration is likely to prioritize cutting government spending and reducing deficits, as it is historically unpopular to cut spending, with insufficient groundswell for fiscal discipline despite past examples like the Clinton administration achieving budget surpluses.
“if you go by history um Trump was just as prolific a spender as any Democratic regime um and our base case is that um it's never popular to cut spending and um there's just an insufficient um ground swell for fiscal discipline”
The Mario Draghi competitiveness report on EU performance misses the fundamental energy issue constraining Europe, instead engaging in 'hoop jumping' that dodges the root cause of competitive disadvantage.
“the particular subject at hand that causes to WR report was mariio dr's report on the eu's competitiveness or lack thereof um and his proposed solutions to address this competitive gap between the European Union and especially the US and China and um for all the hoop jumping the report goes through it Dodges the most fundamental issue”
Mutual awareness of vulnerability between Israel and Iran creates mutually assured destruction (MAD)-like deterrence that changes the strategic game theory: both sides realize escalation is in neither party's interest, making further escalation toward direct warfare unlikely despite regional tensions.
“this sort of mutually assured destruction now changes I think the game a little bit and we would be surprised if Israel attacked Iranian oil infrastructure with this new development our assessment of the Contemporary reporting of the potentiality of this outcome does not give sufficient weight to the consequences of what transpired on the 1 of October this year and if we're right um and we could be wrong and as I said at the beginning of this answer perhaps even spectacularly so but if we are right then we would fade risk of escalation because we would assume that um both sides would realize that it's in neither side's interest to directly escalate in know war with each other”
The BRICS payment mechanism is more accurately described as a settlement mechanism for international trade imbalances using gold as a neutral reserve asset and a basket of currencies, tentatively called 'the unit,' with approximately 40% gold backing, rather than a traditional currency.
“I don't necessarily think it's a currency um in the way that we think of the US dollar um it's more a mechanism to settle uh imbalances that arise in international trade um using gold as an anchor neutral Reserve asset um and some basket of currencies um that I hear is tentatively being called quote the unit which um rather humorous name for it um but um and the numbers I saw it would be like 40% back by gold”
Gold should not be viewed as an investment or speculative vehicle but rather as a store of value, and rising gold prices in USD terms indicate currency debasement; therefore, owning only a small portion of net worth in gold means portfolio losses elsewhere exceed gold gains when gold appreciates significantly.
“gold in our view is not an investment and it's not speculative media it's a it's a store of value and if gold is going up then the value of the US dollar is going down is is how we interpreted and we have a lot of US dollar based assets um that don't involve gold”
A major constraint on AI data center natural gas adoption is corporate carbon emission concerns; however, if Microsoft and Google decline to use natural gas for environmental reasons, other companies and countries will do so, suggesting carbon consciousness will not prevent natural gas utilization.
“one major constraint is how much do the microsofts and the Googles of the world care about carbon emissions because you're still burning a fossil fuel to run a computer or to cool a computer or to do both um but we suspect that if they won't do it others will”
Natural gas will serve as a bridge fuel to the future, powering AI infrastructure and industry until nuclear capacity scales to scale, after which all primary energy sources will remain additive rather than replacing each other, with all sources deployed simultaneously.
“we will burn natural gas as a bridge to the time it takes us to build nuclear power and then when that new nuclear power comes on by the way we'll probably keep burning natural gas anyway because all primary energy sources are additive to the human endeavor”
Political elites in Europe such as Mario Draghi and Ursula von der Leyen are characterized as out of touch with reality regarding energy economics and military strategy, but Doomberg attributes this more to incompetence than to malicious conspiracy.
“we understand why people hold such views the elites of the western world uh confound us with their own seeming lack of basic understanding of both energy economics and apparently um you know military strategy as we're seeing NATO being handed what amounts to a defeat on the battlefield”
The North American natural gas supply glut is persistent and will eventually force the market to equilibrate the oil-to-gas price ratio from 45:1 back to its historical 6:1 ratio based on energy content, through engine switching and new demand discovery.
“we wrote a piece a few months ago that we quoted in this new one called generational Arbitrage um how the North American Natural glut must eventually clear um we miss this part of it which is why we came back to the topic um we felt back then that some combination of engine switching and so on um would necessarily mean that the oil to gas ratio would collapse again um when we first wrote about it the ratio of the price of oil in barrels divided by the price of natural gas in million BTUs was 45 and on an energy content basis it should really be six historically it had traded between sort of 10 and 20”
Natural gas offers significant advantages for powering AI data centers: it is very cheap at approximately $2.75 per million BTU (equivalent to $15-16 per barrel oil), burns cleanly, and can be brought online quickly, enabling co-located closed-loop systems where natural gas input and data output eliminate grid connection requirements.
“there's a few significant advantages one um very very cheap fuel um right now even at 275 per million btu natural gas Henry Hub Today front month that's 1516 a barrel oil um two clean burning three quick to bring online um and if you collocate data centers right next to the natural gas production you don't need to grid connect you can actually Envision closed systems the sort of PODS where natural gas goes in one end of the Pod and data comes out of the other and it's far easier to ship data around the world than it is to ship natural gas”
Gold prices have risen substantially in 2024 primarily because of anticipated BRICS currency mechanisms backed 40% by gold, which necessitates much higher gold prices in USD terms before implementation, reflecting market expectation of this policy outcome.
“I Believe by the way that this is the the most rational explanation for why gold has basically gone straight up this year um because if there's going to be some form of a new neutral Reserve asset used for the settlement of imbalances in international trade that involves gold then the price of gold in US dollars needs to be much higher”
Tin's primary use is in soldering applications driven by semiconductor demand, making it a leverage play on semiconductor recovery from a mini bear market that is now positioned to catch up to AI hype in the equity markets.
“you have an artificial Supply Crunch and you have a potential increase in demand driven by AI because the primary use use of tin is uh in soldering applications which is driven by semiconductor demand and the demand for semiconductors is coming out of a mini bear Market um and and look set to finally catch up to some of the AI hype uh that surrounds the stock market today”
Major LNG exporters (Malaysia, Qatar) will see influx of investment for on-site AI data centers using natural gas directly rather than liquefying and shipping; this doesn't mean less LNG but more raw natural gas production.
“one of the things we speculated in the piece is that the major LG exporters of the world Malaysia Qatar would see an influx of investment and they're seeing it because why chill natural gas and put it on these expensive ships when you could just use it directly and circumvent all that hoop jumping that goes into um making LG the the globally traded fuel that it is um that doesn't mean that we will see less LG by the way it just means we'll see more natural gas produced in these countries because they have an abundance of it”
Canada (Alberta and British Columbia) is an ideal location for natural gas-powered AI data centers due to abundant natural gas, cold winters that facilitate cooling, and geopolitical stability, making it highly likely to see AI infrastructure investment.
“a great place to do this would be in Alberta and British Columbia where it's cold in the winter which helps with cooling requirements and you have this Supernatural gas field uh that is just waiting to be exploited um they could do it in Argentina they could do it in Russia do it in Saudi Arabia”
Russia will not agree to a negotiated settlement that involves Ukraine joining NATO or recognizing Russian territorial gains as temporary, because Russia initiated the war specifically to prevent NATO expansion and would have momentum on the battlefield to refuse such terms.
“the entire reason Russia went into war was to keep Ukraine out of NATO it would be hard to imagine that um with momentum on its side on the battlefield it would agree to such terms”
The three policy changes the EU needs to make—reconciliation with Russia, massive fossil fuel exploration and production, and nuclear reactor construction—are unlikely to occur, making European economic collapse predictable, though the timeline spans years and decades rather than months.
“the three things that we say in the piece that the EU needs to do they aren't going to do like let's let's be clear we don't predict that's what they'll do”
Silver bullish narratives on social media featuring claims of prices reaching $50-$100 per ounce should be treated skeptically as clickbait content, though substantive bullish cases for silver exist among serious commodity analysts with deep sector experience.
“that's sort of content click bity type stuff which you know um sometimes the YouTube um thumbnail is different than the discussion”
Democratic elections are having meaningful impact in Europe, with rightward tilts visible in recent results, leading to policy changes in Germany and compromises in coalition formation, suggesting that public voting power is not entirely ineffectual.
“we're seeing as we predicted rightward tilt um the people and their votes are having an impact for example we're seeing policy changes in Germany we're seeing um coalitions being formed to keep certain parties out of power but by doing so they have to make certain compromises”
Tin is currently one of the best-performing commodities in 2024, up approximately 30% at the time of writing, making it worthy of investor attention despite being an obscure or overlooked market.
“but tin is one of the better producing or better returning medals on the board for 2024 um it's doing quite well up some 30% at the time that we wrote that piece”
Oil prices are spiking higher due to geopolitical risk from the escalating conflict in the Middle East, with observable market reactions to headlines about regional tensions translating directly to $3 price spikes when news breaks.
“so first of all that is clearly the reason why oil is spiking higher you could see when certain you know bold red headlines cross the wires on Bloomberg um the oil price spikes $3”
Doomberg publishes 7-8 articles monthly on Substack, maintains a closed comment section for paying subscribers (to exclude trolls and noise), and offers a 'pro tier' with monthly deep-dive webinars ('Doom Zoom') on energy and related topics.
“doomberg dcom is where you can find everything um we write seven to eight articles a month we also have a pro tier where we do a deep dive presentation once a month on on all things energy and a few other topics these are put together by us and Del deled via webinar form um but the the annual subscription gets you all the Articles and the pro tier gets you the Articles and this monthly Doom Zoom as we call it”
Doomberg does not own silver and instead exclusively purchases gold for storage due to its superior storage density, though they respect Sir JJ's silver analysis and believe he is likely correct.
“we we don't own any um I just buy gold it's it's more a higher density of storage um you know in my safe but um I understand why people are Buller silver because there is this uh incremental potential demand and solar Ford and so on but sir JJ's bullish silver and if he's bullish silver then I would say that U given my respect that I have for him”
John Johnston (known as Sir JJ), a commodity sector veteran with 50 years of experience including pit trading in the 1970s, provides compelling bullish analysis of silver and has maintained this position for the past 5-6 years with high-quality analysis worth following.
“one of our friends in a new substack writer who you should probably have on the show by the way um uh John Johnston of of the author of Market Vibes um is known by his friends as Sir JJ he's not kned but um he has been in and around the commodity sector for 50 years if you can believe it was trading in the pits in the 70s and he writes a fantastic substack daily twice daily substack on the markets and he is bullish silver um has been bullish silver for the last five6 dollar”