At the peak of inflation and the return of capital to raw materials

Since the beginning of the year Petroleum WTI went up 53 percent, Brent crude oil 52 percent, and gas in the US 30 percent. Such significant increases in the prices of the main energy commodities translate into a huge increase in inflation, which may have reached its peaks in QXNUMX this year. It may persist for a long time without changing the geopolitical situation.

On Thursday, WTI crude oil futures extended their rally above USD 115 per barrel, the highest level since 2008. Russia's invasion of Ukraine and the sanctions imposed on the aggressor may raise concerns about disruptions in the supply of oil, of which Russia is one of the world's major producers. This, in turn, may lead to price increases.

OPEC + with Russia in the lineup does not change the plan 

On Wednesday, the US imposed new export restrictions on the Russian refining sector, and on Belarus, as Russia's ally in its aggression against Ukraine, new export restrictions. So far, however, the United States has not attacked Russian oil and gas exports amid concerns over energy prices. US crude oil stocks continue to decline. Reserves at the Cushing oil hub in Oklahoma have fallen to their lowest level since 2018.

OPEC +, which also includes Russia, decided not to take extraordinary action and yesterday upheld the plan to increase production by 400 tonnes. barrels per day in April.

Capital says goodbye to shares, welcomes raw materials

As reported by the fund PIMCO extension the only way to protect yourself from inflation is to consider having factors that cause inflation in your investor's portfolio, i.e. energy commodities.

The return in the stock-commodity relationship can be quite clearly visible. The ratio of the GSCI (Goldman Sachs Commodity Index) to the S&P 500 seems to be rising rapidly. This may indicate a flow of capital from stocks towards energy resources. We may be in the middle of a new commodity cycle.