Admittedly, I wasn't planning on penning my first newsletter today.  However, I also didn't bet on the US attacking  Venezuela and extraditing its President by force.  While, this is an extraordinary development given the potential implications at play for the markets, I am not going to comment on the politics or legality of what happened but rather discuss the implications for commodities and what this means for Canada going forward.

What Venezuela Means for Canada and Commodity Markets

The important question for investors is whether this meaningfully changes the outlook for oil prices, Canadian energy producers, or broader commodity markets.
My view: the implications are more nuanced—and less threatening to Canada—than they may initially appear.

Implications for the Canadian Oil Sector
Venezuela’s heavy crude, produced primarily in the Orinoco Belt, is similar in composition to oil produced from Alberta’s oil sands. At first glance, this raises concerns about potential competition for Canadian crude if Venezuelan production were to recover.
However, several important realities limit that risk:

1. Restarting Venezuelan production would be slow and costly
Venezuela’s oil infrastructure has suffered from years of underinvestment. Estimates suggest it could require more than US$100 billion and many years to restore production anywhere near prior peaks. Not to mention the distractions that political uncertainty, labour disruptions, and security concerns have on investor confidence.

2. Any recovered supply would likely flow to the U.S. Gulf Coast
If sanctions were lifted and production increased, Venezuelan crude would most naturally be processed by refineries along the U.S. Gulf Coast—where it historically has been consumed. This limits direct competition with Canadian oil, which primarily serves different markets.

3. Canadian crude serves a different U.S. region
The majority of Canadian oil exports are consumed in the U.S. Midwest, not the Gulf Coast. Pipeline infrastructure flows north-to-south, and reversing those systems would be extremely expensive and economically impractical.

Bottom line: It is unlikely that Venezuelan oil would displace Canadian supply in any meaningful way.
If anything, these developments reinforce the strategic importance of Canada continuing to diversify its export markets over time.

Broader Market Implications
From a portfolio perspective, the ripple effects extend beyond oil alone:

• Oil prices: Over the medium term, risks to crude prices remain modestly tilted to the downside, as Venezuela has already been largely absent from global supply for years. Any return would likely be gradual rather than disruptive.
• Gold: Heightened geopolitical uncertainty tends to support gold prices. Increased interest from central banks and investors seeking diversification and resilience remains a notable theme.
• Agricultural commodities: Some “soft” commodities—such as coffee—could see increased attention given production concentration in regions like Latin America, where geopolitical or trade disruptions can have outsized effects.
• Defense and infrastructure spending: Stepping back, ongoing geopolitical tensions may encourage governments globally to increase spending on defense, energy security, and infrastructure—areas that can create long-term investment opportunities.

Investment Takeaway
While geopolitical headlines can feel unsettling, markets tend to respond more to supply realities, infrastructure constraints, and time horizons than to short-term news flow. At this stage, we see no material negative impact on Canadian energy assets and continue to emphasize diversification, discipline, and long-term fundamentals across portfolios.

As always, we will continue to monitor developments and adjust positioning where warranted.

Market Overview - my look into 2026

Have you ever been to a really good party that you didn’t want to end? The music is still playing, people are having fun—but the lights start coming on and you sense the night is winding down.
That’s a good way to describe my feeling of today’s investment markets.
The economy is still growing. Companies are still making money. Investors are still being rewarded. But valuations are high, and there’s a growing feeling that we’re later in the cycle than earlier.

U.S.
The U.S. economy is expected to keep growing in 2026, but at a slightly slower pace than in recent years. Much of that growth is being supported by continued investment in new technologies, including artificial intelligence.
At the same time, households are feeling some pressure. Spending remains solid, but higher prices and borrowing costs are making things more challenging for some families.
One area we’re watching closely is the job market. The U.S. unemployment rate has slowly risen over the past year and now sits around 4.6%. While this is still low by historical standards, the trend suggests the job market is cooling. This is one reason we expect the U.S. Federal Reserve to begin lowering interest rates further in 2026.

Canada
In Canada, the economy is expected to continue to “muddle through” —not strong, but not weak either. Certain sectors, such as financials and materials, should continue to see reasonable conditions.
One potential uncertainty later in the 2nd quarter is trade negotiations under the USMCA agreement. If talks become difficult, this could slow investment and hiring, adding pressure to the Canadian economy.

Bottom Line: Late-cycle markets don’t usually end suddenly—but they do reward discipline.
I believe this environment favours:
•              Companies with strong earnings
•              Businesses with healthy balance sheets and steady cash flow
•              Greater diversification, including exposure to international markets.

Markets may be closer to the later stages of the cycle, but that doesn’t mean it’s time to step away. It means staying patient, diversified, and focused on fundamentals.