00:00Well, let's get more on that with Clem Chambers, who's CEO of Online Blockchain.
00:04Thank you very much indeed for joining us, Clem.
00:06So just sort of back to basics, why did prices in oil surge so sharply after the attacks?
00:12Is it simply fear? Is it just supply and demand?
00:15Well, there's just a huge amount of oil for the world's supply comes out of the Middle East.
00:20And obviously, the closer you get to a configuration in the Middle East,
00:24the more there's going to be the risk of supply shocks.
00:26And therefore, people are going to be buying and the risk of less supply forces the price up.
00:34And oil is quite reasonably cheap these days.
00:37When you look back a few years, there's well over $100 a barrel.
00:40So there's plenty of upside there if supply is going to get disrupted.
00:45So oil did spike about 7% mid-afternoon.
00:48But then Brent is still, as you say, it's still 10% lower than it was about a year ago.
00:52Do you think, though, that we are in for another period of really sharper, higher energy prices
00:58as we were after the situation in Ukraine began with Russia?
01:03Well, it all depends what happens next.
01:06You see, the market has been pricing this in, kind of.
01:09You can see that in the price of gold, in the price of Bitcoin, which are kind of tension measurements.
01:15And they're the thermometers of what could happen.
01:17And then when it happens, you actually get the price move in oil.
01:21Now, what happens next will depend on what goes on with Israel and with Iran
01:26and what each capacity is to retaliate and escalate.
01:31And, you know, if it doesn't escalate, it will all tend to drift down again.
01:35But if you look around the world, it seems to be a cycle of never decreasing tension.
01:40So you would expect this tension increase to affect commodity prices quite steeply.
01:45So oil, gold particularly, and even obscure things like Bitcoin would move ahead if this
01:53tension cycle is going to increase.
01:56We're going to get more and more tension, whether it be in the Middle East or whether
01:59it be between Russia and Ukraine or wherever else it's building up.
02:04Right.
02:04And let's talk a bit more about gold then.
02:06So price is nearing record highs.
02:08What does that say about global investor confidence right now?
02:11Well, it's not investor confidence that's driving gold.
02:15It's central banks and countries because countries have to lay in gold if tension increases
02:20because gold is the currency of conflict.
02:23And as you can see, everywhere you look, there's potential conflicts, you know, from Asia to
02:29the subcontinent, obviously Russia and Ukraine, now the Middle East mean Greenland and the USA.
02:35This cycle of tension means that every country has to lay in strategic reserves that if things
02:42get worse, they have that international currency of conflict, which is gold.
02:48Gold is for conflict.
02:50And finally, what do you see happening to inflation in the near term?
02:55Well, I mean, all these trade tariffs are going to push inflation up.
02:59It's going to push inflation up because, you know, people trade because they can buy cheaper
03:04abroad. So when you start slamming on tariffs, it ups the price of things.
03:09And if you have to make it at home where it's more expensive to make it rather than buying
03:12it abroad, it puts prices up.
03:14So inflation is going to be something that we're going to see elevated.
03:18It's the question of whether it's going to be more than just, you know, the fours and
03:23five percents that we've recently suffered or whether it will be runaway.
03:27I just think we're going to get a heightened level of inflation for several years to come,
03:34maybe not runaway, maybe certainly hopefully not hyperinflation.
03:37But we will be looking back at the days when two percent inflation was was was the norm
03:42and wishing we were back there, I think, over the next four to five years.
03:46Clem, really good to get your insights.
03:48Thank you so much for being with us.
03:49That's Clem Chambers, CEO of Online Blockchain.
03:52Thank you so much for being with us.
