---
title: "Why Joseph Schachter Says the Oil Supercycle Has Only Begun"
url: "https://www.readplaza.com/articles/why-joseph-schachter-says-the-oil-supercycle-has-only-begun"
type: "article"
publisher: "Commodity Culture"
category: "Market Commentary"
published: "2026-07-24T22:04:00+00:00"
updated: "2026-07-29T02:48:54.370296+00:00"
reading_time_minutes: 7
---

# Why Joseph Schachter Says the Oil Supercycle Has Only Begun
I had Joseph Schachter back on Commodity Culture this week, and the timing could not have been better.

The last time he came on the show was just before the Iran war kicked off, and he said oil was going to $100. He was right. We got the initial spike, then the pullback as peace talks briefly calmed the market, and now we’re right back in a situation where crude looks like it could be headed much higher again if this conflict continues to spread.

But what I found most interesting about this conversation is that Joseph does not see the current setup as just a geopolitical spike in oil. He sees it as part of a much bigger story: an energy commodity supercycle where years of underinvestment have left the industry unable to meet future demand without materially higher prices.

That is the key point. Yes, the war matters. A lot. But even if you strip the war out entirely, Joseph is still structurally bullish on oil and natural gas over the next several years.

The market is trading peace or warJoseph’s framing of the oil market right now was very simple: the price is being driven by one central question, peace or war.

He said there is roughly a $20 war premium in crude at the moment, which makes sense when you consider how fast oil moved from the mid-60s back into the high-80s as talks broke down and the hawks regained control in Iran. In his view, if diplomacy somehow takes over and the straits reopen, oil could easily fall back toward $70, while a broader conflict could send prices much higher.

What stood out to me here is that he was not pretending to know exactly how the war ends. He was very clear that the next couple of weeks matter a lot, because either cooler heads prevail or the upside risk in oil becomes very serious very quickly.

The real pressure point may be waterThis was one of the more important parts of the interview for me.

Joseph pointed out that while everyone focuses on oil, the more dangerous pressure point in the Middle East may actually be water. Desalination plants are critical for countries in the region, and he noted that places like Kuwait are especially vulnerable because they have very limited reserve capacity if those facilities are damaged.

That is a chilling thought, but an important one. If civilian populations start losing access to basic water supply, the war moves into a very different category altogether.

Even without the war, he is bullishThis is where the interview got especially valuable for investors.

When I asked Joseph to strip the conflict away and talk about the macro picture for oil on its own, his answer was still bullish. He thinks global demand growth remains real despite the bearish narrative pushed by some major institutions, and he pointed to stronger US demand data as a major reason why.

He also pushed back on the idea that China’s pause in buying automatically means demand is collapsing. His view is that China has spent years building storage and is behaving the way smart commodity buyers usually behave: buying when things are cheap, stepping back when they are not, and managing inventories strategically.

The industry still is not spending enoughThis is really the heart of Joseph’s thesis.

He said the world may see 800,000 to 900,000 barrels per day of demand growth this year, and if the war ends and the global economy stays on track, that number could be even higher next year. The problem is that the industry is not investing enough to replace declines and meet that growth, which means the only way to balance the market may be through higher prices.

That is a very important point for investors. Companies do not make major long-term capital decisions based on a short-term price spike; they need confidence that higher prices are durable enough to justify drilling lower-tier inventory and funding more expensive projects.

US shale is not dead, but it needs higher pricesWe also spent time on the state of US production, and I thought Joseph’s answer was balanced.

He agreed that the best tier-one shale inventory is in decline, but he does not think the US is out of runway. His argument is that what is being depleted first is the cheapest, most economic inventory, and that higher prices bring more tier-two and tier-three drilling locations into play.

That distinction matters. The story is not that US shale is finished; the story is that cheap shale is getting harder to find, and the next leg of growth needs a stronger price signal.

Where he sees opportunityWhen I asked Joseph where he sees the best opportunities, he was very clear that he wants to avoid war-zone exposure and focus on jurisdictions with improving policy and strong resource potential. He highlighted Canada in particular as an attractive place to look and said the UK could also become interesting if policy there shifts back toward supporting North Sea development.

More broadly, he likes companies with strong balance sheets, deep drilling inventory, proven management teams, and management with real skin in the game. He also argued that many energy companies are still trading at depressed cash flow multiples, which leaves room not just for commodity upside but for equity re-ratings as well.

Why this mattersWhat I liked about this interview is that Joseph gave a framework that works in both the short term and the long term.

In the short term, the oil market is being pushed around by war headlines, shipping risk, and the possibility of wider escalation. In the longer term, the bigger issue is still underinvestment, and that means even if the war premium comes out for a while, the structural setup for energy may remain much tighter than most investors realize.

That is why I think energy continues to deserve far more attention than it gets. For years, capital has chased whatever the market sees as the next big thing while treating hydrocarbons like a dying industry, but the global economy still runs on oil and gas, and if supply cannot keep up, the market has a very simple way of solving that problem: higher prices.

Joseph thinks we are still early. After this conversation, I think that is a view investors should take seriously.

My ReadSo given all of this, which companies do I think will benefit the most up ahead from a potential long-term re-rating of the oil price in the $70 - $90 range (or even higher)? It's no secret that I'm a major oil bull and the sector makes up close to 20% of my own portfolio, so instead of speculating here, I'll just go ahead and give you the stocks I have the most conviction in that I actually hold. These are all located in Canada, a jurisdiction Josef is particularly bullish on right now.

Cenovus Energy: One of the largest oil sands producers in Alberta and has significant downstream refining operations, providing some natural hedging against crude price volatility and as refinery capacity globally is spread thin at the moment, it could also provide major upside and deliver a double-whammy of profits in a higher-priced environment for oil.

Whitecap Energy: Delivered record Q1 production, raised full year production guidance for 2026, has high-quality, low decline assets, is buying back shares, and pays a nice 4.5% dividend, what's not to like? If you're bullish oil, Whitecap is one of the best plays in Canada, in my opinion.

Surge Energy: A truly oil-focused company with an 88% liquids production, meaning you get higher torque in terms of exposure to the oil price, without having to worry too much about where natural gas prices end up. Generating strong free cash flow, buying back shares and like Whitecap, pay a nice dividend of around 5%.

There's plenty of other solid names out there in the oil and gas space, and if you'd like to lower the risk and focus on making a bet on the sector as a whole, the XEG or ZEO ETFs cover the Canadian side, and XLE and XOP ETFs cover U.S. producers.