Building a High-Yield Portfolio from Scratch – Part 2: Megatrend 1 – Is oil and gas sector still investable?
Can we enjoy 10+% sustainable dividends in this sector ?
Navigating the global energy transition as an investor is a balancing act. Should we abandon oil as a relic of the past, or does it still hold untapped potential? In this article, we lay the foundation for a resilient income strategy amid shifting energy dynamics.
1. Charting the Course: Oil's Future in a Shifting Energy Paradigm
In my previous article, I posed two pivotal questions:
Can the world afford the financial toll of the energy transition?
Even if we can, do we have the mineral resources necessary to see it through?
While these questions suggest their own answers, let's inject some objectivity. The International Energy Agency's (IEA) World Energy Outlook 2024 outlines three distinct scenarios. I’ll focus on the STEPS scenario, which I believe paints the most realistic picture. Here's a quick recap:
STEPS (Stated Policies Scenario): Projects the energy sector's future based on current and announced policies, anticipating a 2.4°C temperature rise by 2100.
APS (Announced Pledges Scenario): Assumes full and timely implementation of national climate pledges, resulting in a 1.7°C temperature rise by 2100.
NZE (Net Zero Emissions Scenario): Envisions a pathway to net-zero CO₂ emissions by 2050, aligning with a 1.5°C warming limit.
The full strategy, analysis, and archives are now hosted on our dedicated platform.
You have the initial data, but to successfully build a resilient 10%+ Yield portfolio from scratch, you need the critical next steps:
The detailed supply outlook and the key factor driving long-term oil prices.
The Investment Strategy: A Dual Approach balancing traditional and transitional energy.
The full I-CASH Method application to a high-yield oil stock (12%+ dividend).
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Disclaimer: This article is for informational and educational purposes only and does not constitute financial, investment, or legal advice. The views expressed are personal opinions and should not be taken as specific recommendations. Investing involves risks, including the potential loss of capital. Always conduct your own research and consult a qualified financial advisor before making any investment decisions. The author is not responsible for any financial losses or decisions based on the content of this article.
Good article !