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00:00WE WERE TALKING ABOUT THE U.S.-CHINA TRADE WAR. YOUR TAKE ON THE TRADE WAR THAT 75% OF A TRADE WAR IS STILL A TRADE WAR, AND IT HAS DONE A LOT OF DESTRUCTION TO THE DEMAND PICTURE, AND THAT HAS NOT CLEARED UP YET. KEVIN: THE MAIN POINT IS THAT THE UNCERTAINTY THAT HAS BEEN STALLING INVESTMENT IN THE INDUSTRIAL SPACE IS THE THING THAT IS KILLING DEMAND FOR THE INTERMEDIATE TERM. YOU CAN LOOK AT PMI ' S, THE STOXX INFLOWS, INVENTORIES AND PRODUCTION, BUT THAT IS THE BACK -- BUT IN THE END, IT IS THINGS NOT SANCTIONED, COURSES NOT TAKEN. AT THAT BACKLOG HAS NOT BEEN REBUILT BECAUSE THERE IS A PRELIMINARY BARGAIN. IF YOU LOOK AHEAD AT PHASE I AND ON, IF THIS DOES NOT STICK FOR SOME REASON, WE MOVE FROM TRADE WAR TO A PERHAPS DECOUPLING, AND ALL THAT THAT BRINGS. WITH THE UNCERTAINTY, THERE IS ROOM FOR DEMAND TO LAG A LITTLE BEHIND EXPECTATIONS PRICED INTO THE MARKETS TODAY. SCARLET: WE ARE ALSO IN THIS WORLD WHERE DEGLOBALIZATION SEEMS TO BE A LARGER TREND, WHICH WILL TAKE YEARS TO A UNFOLD. -- TWO UNFOLD. IF THIS GOES FOR -- FAR ENOUGH, THIS COULD PROVIDE AN OPPORTUNITY. EXPLAIN. KEVIN: WHEN YOU THINK OF DEGLOBALIZATION, THINK OF IT AS THE DECOUPLING OF THE TWO LARGEST ECONOMIES, BREAKING UP DEMAND IS STIMULATIVE. METAPHORICALLY, ONE APARTMENT TO TWO APARTMENTS, ONE CAR TO TWO CARS, YOU HAVE A SHORT-TERM POP, BUT THE LONG-TERM TRADE RELATIONSHIP COULD HAVE REDUCED ECONOMIC DIVIDENDS WHICH HAVE GROWN IT FURTHER HAD IT STAYED TOGETHER. IT MIGHT GIVE ILLUSION OF DEMAND STIMULUS, BUT THAT IS NOT LIKELY TO LAST. FRANCINE: KEVIN, YOU TALK ABOUT UNDERINVESTMENT. WHAT DOES THAT MEAN FOR ENERGY FUTURES? IN FOUR TO FIVE YEARS, DOES THIS UNDERINVESTMENT MEAN PRICES WILL SHOOT UP? KEVIN: UNDERINVESTMENT IN THE UPSTREAM IS WHAT I THINK YOU ARE TALKING ABOUT. THE UNLOCKING OF LOW PRICES BY UNDERINVESTMENT, BECOMING HIGH PRICES IN THE FUTURE, THAT IS THE CYCLE OF THE SUPPLY SYSTEM FROM START TO FINISH. THE QUESTION IN THIS CASE IS LESS ABOUT THE UNDERINVESTMENT IN THE ENERGY UPSTREAM, SO MUCH AS THE UNDERINVESTMENT IN THE DEMAND SIDE. THE INDUSTRIAL UNDERINVESTMENT CREATED BY TRADE UNCERTAINTY CREATES A WHILE TO WASH OUT OF THE SYSTEM, TAKES A WHILE FOR PROJECTS DRIVING GROWTH TO COME BACK INTO PLAY. THIS IS NOT AN OVERNIGHT THING. FRANCINE: KEVIN, WHEN YOU LOOK

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Second Trump Term Brings Risk of U.S.-China Decoupling: ClearView

Kevin Book, co-founder of ClearView Energy Partners, discusses the outlook for the U.S.-China trade war in the event of a second Donald Trump presidency and the impact on energy demand. He speaks on "Bloomberg Surveillance." (Source: Bloomberg)

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