Over the last few years, the combination of low commodity prices, ESG concerns, and uncertainty around long-term demand has triggered an abrupt stop to investments in the energy sector. Today many of these companies have an implied cost of equity over 25%, making any new investments prohibited by the capital markets.
These dynamics, coupled with the long decarbonization path we now embark on, set the stage for a commodity super-cycle that could last 3-5 years in our view. It is these opportunities within Energy, Transportation, and Commodities that S.D. Standard ETC Plc seeks to take part in.