In this episode of Monetary Matters, Max Wiethe sits down with Michael Kao, CIO of Cantos Capital Management and the Kao Family Office, to unpack the real energy risks facing the U.S. economy. The conversation opens with Venezuela and the Trump administration’s push to reshape global oil supply. Michael explains why Venezuela’s vast reserves are unlikely to move the market quickly, why OPEC spare capacity still caps oil prices, and why he remains structurally bearish on oil despite constant fears of shortages. From there, the focus shifts to what Michael believes is the true vulnerability: natural gas. He lays out a three-pillar thesis centered on premature electrification, the explosive growth of AI data centers, and expanding LNG exports. Together, these forces are driving electricity demand higher for the first time in decades, straining a power grid that increasingly depends on natural gas for baseload generation. The episode concludes with a discussion of how Michael is positioning for this shift, why he favors natural gas mineral rights over commodities or equities, and why natural gas is fundamentally different from oil when it comes to geopolitics and government intervention.

Read Michael’s Substack, “Macro/Geopolitics/Investing - The Energy Achilles' Heel of America” here: https://www.urbankaoboy.com/p/re-macrogeopoliticsinvesting-the

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Timestamps:

00:00 Introduction to Geopolitical Energy Security

00:46 US Energy Concerns and Venezuela

01:33 Venezuela's Oil Production Potential

03:22 Natural Gas: The New Dependency

04:49 Challenges in Oil Production and Pricing

15:16 The Role of Natural Gas in the Energy Market

20:58 The Future of Natural Gas and Electricity Demand

31:13 Investment Strategies in Natural Gas

32:03 Challenges and Risks in Natural Gas Trading

33:45 Advantages of Mineral Rights Investments

38:16 Global and Local Dynamics of Natural Gas

40:39 Data Centers and Energy Demand

42:39 Future of Natural Gas and Market Trends

52:26 Investment Considerations and Strategies

01:03:12 Conclusion and Final Thoughts

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