Alt Thinking April 10, 2025
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Ninepoint Energy Market Update

Ninepoint Energy Market Update - 4.10.2025
Investment Team
  • Eric Nuttall
    Partner, Senior Portfolio Manager
    Eric Nuttall
    Partner, Senior Portfolio Manager
    Eric Nuttall is a Partner and Senior Portfolio Manager with Ninepoint Partners LP. He joined the firm in August 2017. Prior to joining Ninepoint, Eric began his career with Sprott Asset Management LP as a Research Associate in February 2003. He progressed to roles as an Analyst, Associate Portfolio Manager, and ultimately Portfolio Manager in 2010.  Eric's views on energy are frequently sought after by BNN Bloomberg, CNBC, The Globe and Mail, The National Post, and other media organizati...
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  • Keegan Stoyles, CFA, P.Geo.
    Associate Portfolio Manager
    Keegan Stoyles, CFA, P.Geo.
    Associate Portfolio Manager
    Keegan joined Ninepoint Partners in January 2022 as an Analyst for the Ninepoint Energy Fund. Prior to Ninepoint, Keegan worked as an Equity Research Associate at TD Securities with a focus on the Energy sector, with coverage spanning Canada, the U.S and several European Supermajors. Prior to that he started his career at Encana (now Ovintiv) as a geologist and also spent several years at a private startup oil & gas company. He attended the University of Calgary and obtained a Bachel...
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Key Takeaways
  • Oil below $60 WTI has put U.S. shale in the “death zone,” halting production growth and triggering sharp cutbacks in growth capex.
  • Canadian oil producers remain resilient with strong balance sheets, sustainable dividends, and decades of inventory—even at $51 WTI.
  • Global oil demand forecasts are being cut due to tariff-driven GDP risks, but supply is tightening as short-cycle output declines.
  • Market panic is creating deep value opportunities in Canadian energy stocks trading at attractive free cash flow yields.

April 10, 2025

In this high-volatility edition Eric dissects the whipsaw action in oil markets following retaliatory tariffs and widespread global uncertainty. With oil dipping below $60 WTI and market panic intensifying, Eric breaks down what this means for demand forecasts, US shale, Canadian oil producers, and natural gas fundamentals.

Key Topics Covered:

  • Volatility Overload – The oil market is reeling from massive uncertainty around tariffs, GDP, and OPEC+ actions.
  • Demand Forecasts Cut Sharply – Energy Aspects cuts global demand by 450,000 bpd; market struggling to assess true impact.
  • GDP-Demand Link – Every 0.1% drop in global GDP = ~100,000 bpd demand loss; recession risk looms large.
  • US Shale Hits the Death Zone – At sub-$60 oil, production growth halts; rig count expected to decline.
  • Growth Capex Getting Slashed – U.S. and Canadian firms are prioritizing balance sheet strength and dividends over expansion.
  • Canadian Oil Resilience – Companies defend dividends at $51 WTI; many are net cash with decades of inventory.
  • Sector-Wide Panic Creates Opportunity – Market dislocation = chance to add exposure to deep-value, long-inventory names.
  • OPEC Put in Question – Market perceives a loss of OPEC’s price floor, but true compliance and coordination efforts may still emerge.
  • Natural Gas Still Bullish – $5 remains the marginal cost of supply; LNG ramping supports the thesis.
  • US Shale Inventory Crisis Growing – Publicly unspoken for years, but now becoming too obvious to ignore; M&A likely coming to Canada.
  • Long-Term Value in Canadian Assets – Investors today can still buy multi-decade free cash flow streams for free post-selloff.
  • Final Word: Know What You Own – The strength of Canadian models—low decline rates, strong balance sheets, sustainable dividends—makes them best suited to weather today’s chaos.

While the short-term oil price may remain volatile, Canadian energy equities are positioned as potential long-term winners.

 

Historical Commentary

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    April 2025
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    In this week’s update, Eric Nuttall, Senior Portfolio Manager of Ninepoint Energy Strategies, recaps CERAWeek in Houston, where top oil executives, analysts, and industry leaders debunked long-held false narratives and reinforced the long-term bullish case for oil and energy stocks.
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    In this week's long format video, Eric Nuttall, Senior Portfolio Manager at Ninepoint Energy Strategies, breaks down the key themes shaping the energy market, including the impact of Trump’s proposed tariffs, the false narrative around surging U.S. shale production, and why Canadian energy stocks remain deeply undervalued.
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    This week, Eric Nuttall, Senior Portfolio Manager of Ninepoint Energy Strategies, dives into the volatile energy markets, key developments in Canadian oil and pipeline strategy, and how shifting geopolitical and economic factors are shaping global energy prices.
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    In this week’s edition, he breaks down a volatile week in energy markets, driven by fears over AI’s impact on energy demand, ongoing natural gas weakness, and growing concerns over potential 25% tariffs on Canadian oil.
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    January 2025
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    In this week’s update, Eric provides key insights from the recent Peters & Co. Oil Conference in Calgary, where he met with CEOs of major oil and gas companies. He explores crucial topics shaping the energy sector in 2025
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  • NPP008
    (Series F)
    Mutual Funds Exchange Traded Funds Sector Equity
    $27.21 $0.07 (0.27%)
    As at 4/14/2025
    Growth of $10,000 Invested as at 3/31/2025
    Performance as at 3/31/2025
    1 Year
    0.77%
    3 Year
    7.79%
    5 Year
    72.55%
    10 Year
    7.81%
    Incept.1
    7.44%
    1 Inception Date 4/16/2004
    Go To Fund

    All returns and fund details are a) based on Series F shares; b) net of fees; c) annualized if period is greater than one year; d) as at 3/31/2025. Where applicable, all figures are annualized and based on monthly returns since inception. Risk-free rate and minimum acceptable rate calculated using rolling 90-day CDN T-bill rate. The rate of return or mathematical table shown is used only to illustrate the effects of the compound growth rate and is not intended to reflect future values of the mutual fund or returns on investment in the mutual fund. Top ten holdings, sector allocation and geographic allocation as at 3/31/2025. Top ten holdings based on % of net asset value. Sector allocation based on % of net asset value. Geographic allocation based on % of net asset value and excludes cash. Numbers may not add up due to rounding. Cash and cash equivalents include non-portfolio assets and/or liabilities.

    The rate of return is used only to illustrate the effects of the compound growth rate and is not intended to reflect future values of the investment fund or returns on investment in the investment fund.

    In each taxation year, the Fund will distribute to its investors a sufficient amount of the Fund’s net income and net realized capital gains so that the Fund will not pay any income tax. The net income and the net realized capital gains of the Fund will be distributed annually in December.

    The Fund is generally exposed to the following risks: concentration risk; credit risk; currency risk; cybersecurity risk; derivatives risk; energy risk; exchange traded funds risk; foreign investment risk; inflation risk; interest rate risk; liquidity risk; market risk; performance fee risk; regulatory risk; Rule 144A and other exempted securities risk; securities lending, repurchase and reverse repurchase transactions risk; series risk; short selling risk; small capitalization natural resource company risk; specific issuer risk; tax risk. Additional risks associated with an investment in ETF Series securities of this Fund include: absence of an active market for ETF Series risk; halted trading of ETF Series risk; trading price of ETF Series risk.

    Ninepoint Partners LP is the investment manager to a number of funds (collectively, the “Funds”). Commissions, trailing commissions, management fees, performance fees (if any), and other expenses all may be associated with investing in the Funds. Please read the prospectus carefully before investing. The indicated rates of return for series F units of the Funds for the period ended 3/31/2025 are based on the historical annual compounded total returns including changes in unit value and reinvestment of all distributions or dividends and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. This communication does not constitute an offer to sell or solicitation to purchase securities of the Funds.

    The information contained herein does not constitute an offer or solicitation by anyone in the United States or in any other jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. Prospective investors who are not a resident in Canada should contact their financial advisor to determine whether securities of the Fund may be lawfully sold in their jurisdiction.

    FundGrade A+® is used with permission from Fundata Canada Inc., all rights reserved. The annual FundGrade A+® Awards are presented by Fundata Canada Inc. to recognize the “best of the best” among Canadian investment funds. The FundGrade A+® calculation is supplemental to the monthly FundGrade ratings and is calculated at the end of each calendar year. The FundGrade rating system evaluates funds based on their risk-adjusted performance, measured by Sharpe Ratio, Sortino Ratio, and Information Ratio. The score for each ratio is calculated individually, covering all time periods from 2 to 10 years. The scores are then weighted equally in calculating a monthly FundGrade. The top 10% of funds earn an A Grade; the next 20% of funds earn a B Grade; the next 40% of funds earn a C Grade; the next 20% of funds receive a D Grade; and the lowest 10% of funds receive an E Grade. To be eligible, a fund must have received a FundGrade rating every month in the previous year. The FundGrade A+® uses a GPA-style calculation, where each monthly FundGrade from “A” to “E” receives a score from 4 to 0, respectively. A fund’s average score for the year determines its GPA. Any fund with a GPA of 3.5 or greater is awarded a FundGrade A+® Award. For more information, see www.FundGradeAwards.com. Although Fundata makes every effort to ensure the accuracy and reliability of the data contained herein, the accuracy is not guaranteed by Fundata. CIFSC category: Energy Equity. Number of funds in the category: 18. FundGrade start date: 12/31/2014. FundGrade Calc date: 12/31/2024.

    Ninepoint Partners LP: Toll Free: 1.866.299.9906. Dealer Services: CIBC Mellon GSSC Record Keeping Services: Toll Free: 1.877.358.0540

     

  • NPP5502
    (Series F)
    Exchange Traded Funds Liquid Alternatives Sector Equity
    $7.51 $0.04 (0.52%)
    As at 4/14/2025
    Growth of $10,000 Invested as at 3/31/2025
    Performance as at 3/31/2025
    1 Year
    -13.77%
    3 Year
    3.80%
    5 Year
    -
    10 Year
    -
    Incept.1
    3.32%
    1 Inception Date 3/8/2022
    Go To Fund

    All returns and fund details are a) based on Series F shares; b) net of fees; c) annualized if period is greater than one year; d) as at 3/31/2025. Where applicable, all figures are annualized and based on monthly returns since inception. Risk-free rate and minimum acceptable rate calculated using rolling 90-day CDN T-bill rate. The rate of return or mathematical table shown is used only to illustrate the effects of the compound growth rate and is not intended to reflect future values of the mutual fund or returns on investment in the mutual fund. Top ten holdings, sector allocation and geographic allocation as at 3/31/2025. Top ten holdings based on % of net asset value. Sector allocation based on % of net asset value. Geographic allocation based on % of net asset value and excludes cash. Numbers may not add up due to rounding. Cash and cash equivalents include non-portfolio assets and/or liabilities.

    The rate of return is used only to illustrate the effects of the compound growth rate and is not intended to reflect future values of the investment fund or returns on investment in the investment fund.

    The monthly distribution amount may be adjusted by the Manager without notice throughout the year as market conditions change. Monthly distributions will be comprised of net income, net realized capital gains and/or return of capital. Any net income and/or net realized capital gains earned by the Fund in excess of the monthly distribution will be distributed to unitholders annually in December.

    The Fund is generally exposed to the following risks: borrowing risk; capital depletion risk; collateral risk; commodity risk; concentration risk; currency risk; cybersecurity risk; derivatives risk; energy risk; foreign investment risk; inflation risk; interest rate risk; leverage risk; liquidity risk; market risk; performance fee risk; regulatory risk; Rule 144A and other exempted securities risk; securities lending, repurchase and reverse repurchase transactions risk; series risk; short selling risk; small capitalization natural resource company risk; specific issuer risk; substantial securityholder risk; tax risk. Additional risks associated with an investment in ETF Series securities of this Fund include: absence of an active market for ETF Series risk; halted trading of ETF Series risk; trading price of ETF Series risk.

    Ninepoint Partners LP is the investment manager to a number of funds (collectively, the “Funds”). Commissions, trailing commissions, management fees, performance fees (if any), and other expenses all may be associated with investing in the Funds. Please read the prospectus carefully before investing. The indicated rates of return for series F units of the Funds for the period ended 3/31/2025 are based on the historical annual compounded total returns including changes in unit value and reinvestment of all distributions or dividends and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated. This communication does not constitute an offer to sell or solicitation to purchase securities of the Funds.

    The information contained herein does not constitute an offer or solicitation by anyone in the United States or in any other jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. Prospective investors who are not a resident in Canada should contact their financial advisor to determine whether securities of the Fund may be lawfully sold in their jurisdiction.

    Ninepoint Partners LP: Toll Free: 1.866.299.9906. Dealer Services: CIBC Mellon GSSC Record Keeping Services: Toll Free: 1.877.358.0540

    Disclaimer: This advertisement is for information purposes only and should not be relied upon as investment advice. We strongly recommend that you consult your investment professional for a comprehensive review of your personal financial situation before undertaking any investment strategy. Information herein is subject to change without notice and Ninepoint is not responsible for any inaccuracies or to update this information. The information contained herein does not constitute an offer or solicitation by anyone in the United States or in any other jurisdiction in which such an offer or solicitation is not authorized or to any person to whom it is unlawful to make such an offer or solicitation. Prospective investors who are not resident in Canada should contact their financial advisor to determine whether securities of the Funds may be lawfully sold in their jurisdiction. 

    Ninepoint Partners LP is the investment manager to the Ninepoint Funds (collectively, the ''Funds''). Important information about these Funds, including their investment objectives and strategies, purchase options, and applicable management fees, performance fees (if any), and expenses, is contained in their prospectus or offering memorandum. Please read these documents carefully before investing. Commissions, trailing commissions, management fees, performance fees, other charges and expenses all may be associated with investing in the Funds. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated.