Wealth Outlook 2024 - Slow then grow

60 Wealth Outlook 2024 | Opportunistic Our top 10 high conviction potential opportunities FIGURE 5 Saudi production cuts benefit non-OPEC producers US crude oil production Saudi Arabia crude oil production Thousands of barrels per day 16,000 10,000 4,000 2010 2012 2014 2016 2018 2020 2022 2024 Source: Haver Analytics through November 3, 2023. FIGURE 6 Benefits show up in creating a floor under US crude prices... YoY% change Recession WTI crude oil price 300 150 0 -150 1970 1980 1990 2000 2010 2020 Source: Haver Analytics through October 31, 2023. 3. Western energy producers, equipment and distributors Russia’s invasion of Ukraine forever realigned energy supply chains, with Europe turning to gas suppliers from the US and the Mideast. Recent conflict in Israel and the Gaza Strip further underscores that world petroleum supplies have both “concentration risk” and substantial political/geopolitical risk. (Russia and Iran together account for 20% of world crude oil production.⁵ ⁵ Haver Analytics, OPEC as of October 31, 2023. ) OPEC’s decision to lower crude oil production pre- emptively in a slowing world economy – to maintain high prices even at the expense of lost market share to alternatives – should be considered a “gift” to non-OPEC suppliers and the clean energy value chain alike ( FIGURE 5 ). The competitive economics of energy supplies with oil at $80 per barrel are markedly different for producers than at $24, the trough price for Brent reached on average following the last four US recessions ( FIGURE 6 ). Higher oil