Oil And The Real Estate Cycle

2025-06-03 09:11:15 ET

Summary

• The land cycle, repeating every 20 years, influences economic patterns, with land prices rising and falling based on private debt and interest rates.
• Oil prices exhibit significant spikes in alignment with the land cycle peaks, driven by supply or demand shocks, as seen in 1990 and 2008.
• Current oil price trends suggest a likely decline leading up to the 2026 land cycle peak, with potential for a supply-side shock due to geopolitical tensions.
• Mechanical factors of lower oil capex point to a shortage of supply going into 2028.

This article explores the relationship between the 20-year land cycle and oil price movements, highlighting recurring patterns and their implications for investors. Historical data suggests that oil prices tend to spike during land cycle peaks, often due to supply shocks, and subsequently decline as a land-led recession unfolds,...

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