A 2025 energy emergency, an EIA outlook toward 2026, and what falling oil is taken to mean

According to an article the essay cites, Donald Trump, on taking office as U.S. president in 2025, declared a national energy emergency and made clear a will to expand oil and natural-gas drilling across the board. With the remark that the liquid gold under our feet — oil — would make America wealthy again, a plan to refill the strategic petroleum reserve and to export energy to the world was made public. These measures were quickly reflected in the market. Brent and WTI each declined, and the price of natural gas also turned downward. Material from the U.S. Energy Information Administration, as cited, is expecting U.S. crude production to keep increasing through 2026, and as making it likely that international oil prices will fall to a level around an average of 66 dollars a barrel. A widening of supply can induce a downward stabilization of global energy prices and help refiners’ profitability, but a high exchange rate, stronger protectionism, and geopolitical risk are still raising uncertainty. As a tariff policy was formalized, investment sentiment froze sharply, and the Nasdaq declined, centered on technology stocks; large information-technology firms with a high share of overseas sales took a direct blow, and oil prices also came down quickly as a contraction in global demand was raised. In this flow, the essay says, deregulation and tax cuts are increasing capital flowing into U.S. technology stocks and leading a Nasdaq recovery.

On a daily crude chart, a recent sharp decline is conspicuous. A drilling-expansion policy that puts energy independence forward, and concern about shrinking global trade, appear to have put downward pressure on oil from both sides. In general a fall in crude can shrink production costs and improve profitability, but when geopolitical tension and a contraction of trade are meshed, a slowing of demand may be the larger problem. Cyclical industries such as refining, chemicals, machinery, and semiconductors can find cheaper oil a short-term benefit, yet if consumption contracts from stronger tariffs, sales may fall overall. When the market avoids risk, funds move toward utilities, health care, and staples, which helps explain weak related stocks even as oil falls. Technically the decline has the character of a trend change after a support break; after a sharp drop, prices are searching for a new lower end, though a bounce attempted twice at a range leaves open a possible double bottom. Natural gas has also fallen sharply, with concern of excess supply from expanded U.S. drilling and exports, and with a demand shock from protectionism superimposed. Fibonacci retracements of 38.2, 50, and 61.8 percent, and an RSI below 30, suggest a possible technical bounce. Gold, after a rise lasting nearly a year, has entered a correction; Investing.com is cited on gold absorbing uneasy sentiment as U.S. energy policy changed and global tension rose. The Nasdaq, after a temporary hit to technology stocks, is recovering relatively quickly, with expectations for artificial intelligence, semiconductors, and the cloud still strong, and with a possible rate hold and improved consumption indicators having supported sentiment; after breaking support and falling sharply, a possible double bottom is conspicuous.

Three Korean firms, as 2023 to early-2025 figures and a mid-April trade place them

The essay says it will analyze five related firms’ financial statements; only three cases are filled in the extract, and the others. ESTsoft, as the financial account names the firm, recorded a continuing operating loss even as sales rose. In 2024, sales reached 102.8 billion won, about 11 percent higher than the previous year, but the operating loss widened to 13.5 billion won, as selling and administrative expenses rose. Labor costs fell slightly compared with 2023, but expenses overall had a negative effect on operating profit. As of the end of 2024, total assets were about 199.1 billion won, the debt ratio about 39.37 percent, and cash 42.7 billion won, so short-term liquidity appeared sound. The firm is challenged on profitability, the essay says, but holds a possibility of long-term growth on a stable structure, continuing sales, and demand in artificial-intelligence and security software. After a sharp rise early in April and a correction, as of 16 April a double bottom was completing and moving averages were converging; the writer bought that day, with volume rising after a second low and a 5-day and 20-day line converging. The year of that April is not named in the trading passage, and is not added.

LG Energy Solution, in 2024, recorded sales of 25.6 trillion won and operating profit of 575.4 billion won, growing outwardly but looking somewhat contracted on profitability; in the first quarter of 2025, operating profit recovered to 374.7 billion won. Plants targeted at North America, and benefits under the U.S. Inflation Reduction Act, make actual tax relief and cost reduction possible. Return on equity has fallen somewhat in the short term, but asset turnover and efficiency still hold a high level, and earnings from assets remain solid even without leverage. Repeated demand in electric vehicles and energy-storage systems makes structural profitability more likely than a one-off profit. In mid-April the share, ticker 373220, looked to be holding support around 350,000 won; the writer bought on 16 April at about 351,000 won, aiming at a short bounce of about 3 to 5 percent. The share did not bounce, broke support, and was sold at a loss on 27 May when the whole portfolio was cleared. Selvas AI develops medical AI, speech recognition, and chatbots. As of 2023, sales were in the 57-billion-won range, operating profit a slight surplus, and net income still in the red. Project-type revenue and a high share of research and development leave the quality of earnings unstable for now, though operating cash flow is turning positive, which can ease the structural risk of a temporary deficit at a research-centered firm. The same Korean report, at fuller length, is on CampusDown.

Sources

1. According to an article, Donald Trump, on taking office as U.S. president in 2025, declared a national energy emergency and made clear a will to expand oil and natural-gas drilling across the board. With the remark that “the liquid gold under our feet (oil) will make America wealthy again,” a plan to refill the strategic petroleum reserve and to export energy to the world was made public, and an America-centered energy-hegemony strategy is being taken up in earnest again. These measures of Trump’s were quickly reflected in the actual market. The possibility of a contraction in global demand was raised, and oil prices came down quickly. Brent and WTI each showed a declining trend, and the price of natural gas also turned downward. According to material from the U.S. Energy Information Administration, U.S. crude production is expected to keep increasing through 2026, and accordingly it is likely that international oil prices will fall to a level around an average of 66 dollars a barrel. This widening of supply can induce a downward stabilization of global energy prices and act as a factor improving the refining industry’s profitability, but at the same time factors such as a high exchange rate, a strengthening of protectionism, and geopolitical risk are still raising market uncertainty. Also, as President Trump formalized a tariff policy, the market swayed greatly. As concern about protectionism raised its head again, investment sentiment froze sharply, and the Nasdaq showed a declining trend centered on technology stocks. Large information-technology firms with a high share of overseas sales took a direct blow. The price of crude was no exception. As the possibility of a contraction in global demand was raised, oil prices came down quickly. In this flow, what should be noticed is that the Trump administration’s deregulation and tax-cut policy is increasing capital flowing into U.S. technology stocks and is leading a recovery trend in the Nasdaq. ESTsoft and Selvas AI are firms equipped with competitiveness in the fields of security and of artificial intelligence, respectively, and mid- to long-term growth is expected from a widening of digital transformation and of demand for AI. LG Energy Solution is a representative secondary-battery firm that can secure export opportunities inside the United States, keeping pace with a rise in demand for electric vehicles and energy-storage devices. In this connection, an analysis is intended with a focus on what effect the Trump administration’s energy policy will have on Korea’s energy industry and major firms. Attention is paid to changes in the share prices, profitability, and cost structure of firms directly tied to the import structure of natural gas and crude, and the effect is analyzed quantitatively through the financial statements of five related firms. In the extract, three firm cases are filled, and the unfilled two. In addition, how the Nasdaq index’s technology-stock-centered flow shows a linkage with this policy change, and what change the Trump administration’s deregulation and tax-cut stance will bring to global capital flows, are also to be looked at together, and firms are to be selected and then analyzed. ① Macroeconomic analysis. Looking at a crude-oil daily chart, a recent sharp declining trend is conspicuous. After President Trump declared a tariff policy, the market reacted quickly, and prices of major energy sources including crude fell together. As a drilling-expansion policy that puts energy independence forward and concern about a shrinking of global trade acted at the same time, downward pressure on oil prices appears to have been applied from both the demand and the supply sides. As learned in chapter 12, the core of industry analysis is to grasp how the macroeconomic environment gives what effect to profitability by industry. The price of crude is tied directly not only to the energy industry but also to the cost structure of various fields such as manufacturing, transport, and consumer goods. In general, when the price of crude falls, production costs shrink and a firm’s profitability can improve. But in a situation like this time, where geopolitical tension and a contraction of trade are meshed, a slowing of demand can be seen as the larger problem. Industries differ in reaction speed and sensitivity according to the flow of the business cycle. ‘Cyclical industries’ distinguished in the lecture notes are an industry group greatly affected by raw-material prices, consumer spending, and investment sentiment, and refining, chemicals, machinery, semiconductors, and the like correspond to this. The present fall in oil prices can in the short term be a favorable event for these industries, but if a contraction of global consumption due to a strengthening of tariffs gets under way in earnest, there is also a possibility that it will lead to an overall decrease in sales. In other words, it means that the shock of a slowing of demand can be larger than the effect of a decrease in costs. Also, the concept of ‘sector rotation’ mentioned in chapter 12 becomes an important clue in interpreting the present situation. When the market enters a phase of trying to avoid risk, investment funds move to defensive industries such as utilities, health care, and staple consumer goods rather than energy or capital goods. It explains the reason related stocks are weak at the same time as the fall in oil prices. When demand for crude decreases, refining margins shrink, and the profitability of related firms also comes under pressure. Looking from a technical viewpoint, this decline has the character of a change of trend following a collapse of a support line, not a mere correction. According to the technical-analysis theory explained in the chapter 12 supplementary lecture notes, a support line is an important interval where buying sentiment steps in against downward pressure. If this line gives way, the possibility that a declining trend will get under way in earnest is large, and in fact present oil prices, after a sharp drop, are in a process of searching for a new lower end. But recently, as a bounce has been attempted twice at a certain price range, the possibility that a double-bottom pattern, or a twin-bottom pattern as it is commonly called, may form is also open. This pattern is a representative reversal pattern that can act as a reversal signal with a declining trend stopping, and it means that investors’ buying sentiment is operating again at a certain price range. 1) Macroeconomic analysis, next. Natural gas likewise, like crude oil, is showing a declining trend of a large width. It is a phenomenon that arose meshed with the direction of President Trump’s energy policy, a result of an expansion of natural-gas drilling inside the United States and a rise in exports having brought concern of excess supply to the market. This movement coincides exactly with the basic principle of industry analysis treated in chapter 12, namely the point that the macroeconomic environment has a decisive effect on industry performance. In industry-analysis theory, a supply shock or a policy change is seen as able to give a serious effect to an industry’s profitability and share prices. In fact the Trump administration is trying to pursue America’s energy independence through a resource-expansion policy centered on shale gas, and in the writer’s thinking it is acting in the short term as a factor putting downward pressure on the price of natural gas. At the same time, policies related to protectionism are raising concern about a decrease in global energy demand, and even a demand shock is in a superimposed situation. As in the content above, that the price of natural gas is falling sharply can be said, the writer thinks, to be not a mere market fluctuation but a reflection of a change in industrial structure induced by policy. That is because natural gas is used as a raw material in several industries such as generation, chemicals, and hydrogen production, and therefore a change in price immediately affects profitability and cost structure across industry. For firms with a high share of natural-gas-based generation, or Korean firms that depend on imports of LNG, a change in the Trump policy can act as a short-term opportunity and as a long-term risk. Looking from a technical-analysis viewpoint, present natural gas has the appearance of attempting support near a Fibonacci retracement reference line. On the basis of the main decline interval, the 38.2 percent, 50 percent, and 61.8 percent retracement places overlap with respective supply zones and suggest the possibility of a technical bounce. The present price is close to one of Fibonacci’s core support lines, so the short-term direction can be decided according to whether buying sentiment flows in. Also the RSI indicator is in a state of having entered below 30, and the market appears to be in an oversold interval. It is a signal implying that the possibility of a technical bounce is growing, and it can become a point where investors aim at entering a short-term low. 3) Other major items (gold, the Nasdaq). ① Gold. Recently the price of gold, after continuing a rise rally for nearly a year, has the appearance of having entered a correction phase recently. The writer saw many articles that gold was making a rally, and it is a result of a preference for a safe asset following various risk factors such as Trump’s tariff policy, geopolitical unease, and inflation uncertainty having pulled the price up. According to Investing.com, as a change in America’s energy policy and a heightening of global tension meshed, gold has been absorbing the market’s uneasy sentiment. ② The Nasdaq. Meanwhile the Nasdaq index is showing a relatively fast recovery trend. Technology stocks were temporarily hit by Trump’s tariff-policy announcement, but expectations for core growth industry groups such as AI, semiconductors, and the cloud are still strong. Recently the possibility of an interest-rate hold and an improvement in consumption indicators, among some positive macro indicators, were supporting investment sentiment. Buying sentiment at the low has flowed in, and the index is riding a recovery flow. The Nasdaq has in the past had a tendency to recover quickly after reacting sensitively to interest rates or a geopolitical shock, so whether the elasticity of the bounce can continue this time too is being watched. But there is also room for the elasticity of the rise to be limited according to firms’ results and the direction of policy ahead. It is showing a flow that coincides quite well with the main technical-analysis theory mentioned in the chapter 12 supplementary lecture. First, the point that it showed a sharp declining trend as it departed from a past major support line coincides exactly with the theory of a possibility of a change of trend after a collapse of a support line. In the lecture notes a support line is explained as the last buying force’s defensive line that holds off selling pressure, and it was said that if this line gives way, ordinarily a declining trend gets under way in earnest. In fact the Nasdaq, after breaking a support line, fell sharply in the short term, and the width of the decline was also large. But looking at the flow formed afterward, the possibility of a double-bottom pattern is conspicuous. In the textbook’s pattern-analysis part, a double bottom is introduced as a representative reversal pattern, and it is explained that a declining trend can stop and it can become a turning point of a bounce. The stronger the bounce trend at the second low, the higher the confidence becomes, and it can be interpreted that investors again showed a will to buy at the same point. The present Nasdaq flow also fits this condition. 1) ESTsoft. In recent years, despite an increase in sales, a continuing operating loss has been recorded. Sales in 2024 reached 102.8 billion won, an increase of about 11 percent compared with the previous year, but the operating loss is confirmed to have widened to 13.5 billion won. It is due to an increase in selling and administrative expenses such as labor costs, research and development costs, and advertising and promotion costs. Labor costs decreased slightly compared with 2023, but selling and administrative expenses overall increased and had a negative effect on operating profit. Looking at the financial position, as of the end of 2024 total assets increased to about 199.1 billion won, and the debt ratio is maintaining a stable level of about 39.37 percent. Also, cash and cash equivalents were 42.7 billion won, and there appeared to be no problem in short-term liquidity. These financial traits mean that ESTsoft is at present being challenged on the profitability side, but holds a possibility of long-term growth due to a stable financial structure and continuing sales growth. Considering technical strength in the fields of artificial intelligence and security software and an increase in market demand, it was thought that an improvement in profitability ahead is expected. After rising sharply on a long white candle early in April, and after passing through a period of correction, as of 16 April a double-bottom pattern was completing, and the appearance of attempting a bounce again in an interval of moving-average convergence was shown. The writer bought on 16 April. It was a judgment that actually applied the reversal-pattern conditions of technical analysis and a moving-average analysis learned in class, chapter 12 supplementary. In the double bottom, a support line was clearly maintained between a first low formed at the end of March and a second low early in April, and candles after the second low showed volume increasing and a strong white candle. It fits the theory in the lecture notes that “a purchase is valid on a neckline break after a double bottom.” Also, at a point when the 5-day line and the 20-day line were converging, the share price attempted an upward break with a white line and showed a possibility of a turn to a rise, which was also a ground for the purchase. Therefore 16 April was a buying point with sufficient technical confidence. The year of that April and May is not named in the trading passage. 2) LG Energy Solution. LG Energy Solution, as of 2024, recorded sales of 25.6 trillion won and operating profit of 575.4 billion won, and succeeded in outward growth, but on the profitability side showed a somewhat contracted appearance. But in the first quarter of 2025 it recovered again, with operating profit of 374.7 billion won, and bounced. The largest trait is the point that, through the establishment of plants targeted at the North American market and benefits of the U.S. IRA (Inflation Reduction Act), actual tax reduction and cost reduction are possible. Looking from the viewpoint of ‘financial-ratio analysis’ learned in chapter 14, LG Energy Solution in the short term has had ROE (return on equity) fall somewhat, but on the side of total-asset turnover and asset efficiency it is still maintaining a high level, so the firm’s basic physical strength can be said to be sound. The point that earnings created through assets, even without a financial-leverage effect, are solid can be confirmed through an analysis of ROA (return on assets). Also, on the side of the quality of earnings, because repeated demand in the forward industries (electric vehicles and ESS) is continuing, the possibility that it will lead not to one-off profit but to structural profitability is high. LG Energy Solution (373220), in mid-April at that time, showed a shape of receiving a major support line (around about 350,000 won) technically. That price range was a past low and an interval where demand had flowed in, and it was interpreted as a first bounce place, and the price at the time of the actual purchase was about 351,000 won. As learned in class, in chapter 12 supplementary – technical analysis, it was learned that when a declining trend stops near a major support line and upper wicks begin to shrink, it is seen as a phase in which the possibility of a technical bounce rises. Precisely for this reason the writer, on 16 April, entered a purchase aiming at a technical bounce. The writer’s strategy was a short-term response strategy of realizing a profit of about 3 to 5 percent in a short bounce interval and coming out. But unlike the expectation, the share price did not bounce at once, departed from the lower support line and turned to a declining trend, and the writer became in a ‘stuck’ state. The sale was not a bounce but on 27 May, at a point of clearing the whole portfolio, after taking a stop-loss, in a full sale. 3) Selvas AI. Selvas AI is a firm that develops artificial-intelligence-based solutions, and its main fields are medical AI, speech recognition, chatbots, and the like. This firm’s financial structure is summarized in a word as ‘there is growth, but profitability is low.’ As a result the writer investigated, as of 2023 sales were in the 57-billion-won range, and operating profit recorded a slight surplus, but net income for the period was still in a deficit state. This point is in contact with the concept of ‘quality of earnings’ in chapter 14. On an indicator of judging whether reported profit is at a maintainable level, Selvas AI has much project-type revenue rather than repeated product sales, and because the share of R&D is high, for the time being the quality of earnings can be said to be on the unstable side. Having investigated Selvas AI’s cash flow further, operating-activity cash flow is turning to the plus, and it means that an improving flow is sensed in the ability to generate cash rather than in actual profit. From the viewpoint of ‘cash-flow-statement analysis’ mentioned in chapter 14, actual cash flow is seen as reflecting a firm’s sustainability better than accounting profit, and from a side such as the above, an interpretation is possible that Selvas AI can ease the structural risk of a temporary deficit that an R&D-centered firm undergoes.

Last updated: 14 November 2026