Season 8, Post 12: Top themes for epic uncertainty

Countless commentaries have been written about the current conflict in the Middle East. Whatever else your views on Operation Epic Fury, or the third Gulf War, it has unleashed epic uncertainty for investors. Rather than focus on macro matters, our objective in this piece is to highlight the heightened relevance of several key future trends.

Energy: With oil at ~$110/barrel, some 50% higher than a month prior, and the Strait of Hormuz still blocked, countries globally are inevitably turning to other sources of energy. We made the case as early as 2011 for energy diversification as a strategy, in the same way in which portfolio managers think about asset allocation. We said then that we see liquefied natural gas as a ‘natural’ solution for nations seeking to diversify. More recently, we have highlighted geothermal energy as an alternative source for baseload power.

Power: Grid infrastructure globally is having to cope with increased energy demands. This was the case even prior to the commencement of Middle Eastern hostilities, particularly given accelerating investments in data centres for AI. The critical importance of keeping grid infrastructure functioning has never mattered more. Bloomberg reports that historic under-investment in US grid infrastructure has left over 30% of the network operating beyond its designated lifespan. We have discussed this theme since 2022.

Cybersecurity: Critical assets, whether grid infrastructure or elsewhere, remain at significant risk of compromise in an era of heightened geopolitical uncertainties. Statista estimates that global cybercrime cost over $10tr in 2025, larger than the GDP of every nation globally other than the United States and China. 2026’s figure will almost certainly be higher. The challenges are exacerbated by a major lack of skilled cyber experts and the growing power of AI as a new tool for malicious actors to use. Data have no value unless secured, as we first argued over a decade ago (and most recently, here).

Space: Current hostilities in the Middle East have been restricted to air-based attacks. We believe that space may constitute the next battleground in future conflicts. Space is becoming increasingly congested, contested and competitive. Launch costs have fallen by over 95% in the last 40 years and should drop further as the industry scales. Almost everything that has been (and will be) launched into space is inherently dual use, in our view, serving potentially both civil and defence purposes. Think of space as the final frontier.

The Future Trends Blog will be taking an Easter break and return in the week of 13 April.

31 March 2026

The above is provided for information purposes only and does not constitute investment advice or a recommendation to buy or sell any security. Any forward looking statements are based on assumptions that may change. The views expressed are solely those of the author at the time of writing. Any personal investment held by the author has not influenced the content. This article should not be relied upon for investment decisions. Past performance does not predict future returns, the value of investments and income from them can fall as well as rise.

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Alex Gunz, Fund Manager