Europe’s Breadbasket Under Siege, Grab Commodities While You Still Can
Shah Gilani|March 1, 2022
Here in the US, when we hear “breadbasket” we usually think of the Midwest. Ohio, Kansas, Illinois…
When Europeans hear the phrase, they think of Ukraine – and for good reason. The country distributes 12% of global wheat exports, 16% of corn, and 18% of barley. Ukrainian agriculture is a pillar of grain production for the European continent, and now it’s under siege.
With Russia turning the screw on commodities of all kinds, we’re about to see prices soar even higher than they already have – making this a buy opportunity for us if we get in now.
Grab commodities while you still can, especially this one…
Click the video below to learn more, or read the transcript.
$100 Tuesday 3/1/2022 Transcript:
Hey everybody, Shah Gilani coming to you with a new take-it-to-the-bank Tuesday; what I recommend you should do with $100 now– as in today.
With today being an ongoing saga with what’s happening in Ukraine, we’re going to focus on energy and specifically the “Mac Daddy” of all commodities: oil.
Commodity prices are rising because of the conflict in Ukraine.
If Russia continues its attack on Ukraine and cuts off some of Ukraine’s oil exports, cuts off pipelines, we’re going to see prices of energy rise around the world. But it’s not just that. Also, Ukraine is the breadbasket of Europe. And some say the world, too.
Whether it’s wheat, corn, soybeans, or other soft commodities coming out of Ukraine… commodities will be problematic. Most analysts are saying that we are in a commodities supercycle. We’ve been in a commodity supercycle for a few months. I’ve been saying it for six months, plus that we had entered into a commodity Supercycle. The war in Ukraine is only going to exaggerate price-movement and increase volatility.
And again, the “Mac Daddy” of all commodities is oil. We already see the spike in oil prices because of Russia’s incursion (war) in Ukraine. I think that’s going to continue, not just the incursion. I don’t see Vladimir Putin backing down. Let’s hope he does. But even if he does, I don’t see oil coming back down.
West Texas Intermediate (WTI), the New York futures-based oil product that Americans mainly trade, is trading around $95.50 a barrel. Brent Crude is north of $104 but is the international benchmark of oil. We’re focusing on WTI here and the way I think you can get a ride on larger… I think even “gap up” prices in oil is by buying a hundred dollars’ worth of the easiest ETF to own, to play oil. That’s USO, the United States Oil Fund. It’s an ETF that creates futures on oil, on WTI. That’s where we want to go.
I own USO considerably lower. I’ve had it for some time now for going on a year and a half, thereabouts. My average price is $32.52. That’s my average entry price. So, I’m up. With USO right now at $67.50, I’m up over 108%. But I’m not selling. I think USO can go to 90.
Now from here, that’s a 30% move. Goldman Sachs is calling for WTI to get to $125 a barrel. So, I’m in the same league with Goldman Sachs in terms of my analysis. And as far as my all-call, I’m saying $125 easy. I’m saying $150. I’m way outside the envelope on every other analyst I know by calling for $150 a barrel by the end of the summer.
So, I’m not selling any of my USO. I’m holding onto it. I’m looking for 90 to maybe take some profits off the table. So, if you’re a hundred dollars today by the commodity supercycle led by oil. Buy a hundred dollars’ worth of USO, and look for about a $90 exit on maybe half of your position and see how high the rest of it can go.
Can you get up over a hundred? Uh, yes. If we get to 150 bucks a barrel. Yeah. That’s an easy mark for USO. So, for your take-it-to-the-bank Tuesday: hundred dollars’ worth of the USO.
Cheers, Y’all.
Shah Gilani