Oil’s Undervalued

In the age of AI, oil isn’t just possibly made from dinosaurs — it is a dinosaur. Nobody’s running a data center on diesel, opting instead for nuclear.

As a result, oil prices have largely traded in a sideways $60-$70 range over the past few years. And relative to gold, oil is now substantially undervalued:

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Gold’s price is far above oil’s, a trend that’s likely to close up. (Source: Trading View)

We like the value proposition in oil today. We don’t see gold going lower.

Oil is going higher.

In real, inflation-adjusted terms, bubblin’ crude is cheap. And it’s still valuable for transportation, plastics, backup power, you name it.

The big oil companies have reasonable cash flows and pay big dividends — including the player in our model portfolio.

And in a world where commodity prices are trending higher, oil prices may be the next to pop.

~ Addison

P.S. It’s no surprise we’ve got commodities on the brain: This afternoon on Grey Swan Live!, Portfolio Director Andrew Packer and contributor Shad Marquitz will review the latest developments in the commodity space and determine the best commodity plays through the end of 2025 and into 2026.

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If you have any questions for us about the market, send them our way now to: feedback@greyswanfraternity.com.

In the age of AI, oil isn’t just possibly made from dinosaurs — it is a dinosaur. Nobody’s running a data center on diesel, opting instead for nuclear.

As a result, oil prices have largely traded in a sideways $60-$70 range over the past few years. And relative to gold, oil is now substantially undervalued:

Turn Your Images On

Gold’s price is far above oil’s, a trend that’s likely to close up. (Source: Trading View)

We like the value proposition in oil today. We don’t see gold going lower.

Oil is going higher.

In real, inflation-adjusted terms, bubblin’ crude is cheap. And it’s still valuable for transportation, plastics, backup power, you name it.

The big oil companies have reasonable cash flows and pay big dividends — including the player in our model portfolio.

And in a world where commodity prices are trending higher, oil prices may be the next to pop.

~ Addison

Turn Your Images On

If you have any questions for us about the market, send them our way now to: feedback@greyswanfraternity.com.

Debts and deficits will eventually cause a crisis. Treasury Secretary Scott Bessent’s effort to help bail out the Japanese Yen this week is entirely motivated by self-preservation. The contagion signal flashing in Japanese bonds since late ‘25 is infecting the BOJ, which may be forced to sell U.S. Treasurys to stabilize its own currency.

The copper price is no doubt benefiting from inflation driven by money printing. But the doc don’t lie. Copper’s new all-time highs, while gold and silver still languish, are a sign the AI growth story is also that of the global economy itself.

Many miners were profitable with gold around $2,000 and silver near $50. At sustained prices closer to $4,000 gold and $60 silver, the arithmetic changes dramatically.

The stock market is getting an unexpected boost to kick off August, bucking the historically weak summer session for the U.S. stock market.

What’s happening? The Bank of Japan and the U.S. Treasury are making a coordinated effort to support Japanese yen; a move last attempted nearly 30 years in the height of the Asian Financial contagion (1998).

Many miners were profitable with gold around $2,000 and silver near $50. At sustained prices closer to $4,000 gold and $60 silver, the arithmetic changes dramatically.

The stock market is getting an unexpected boost to kick off August, bucking the historically weak summer session for the U.S. stock market.