The Gold to Oil Ratio is at its second highest level in history.

Last time it was this high, was during the pandemic.

So, who benefits?

Well, gold and silver miners definitely benefit.

So says Tavi Costa, an analyst for Crescat Capital, heavily invested in precious metals, mining exploration, and other counter-intuitive investments when the markets are celebrating artificial growth.

Costa says, 

“Gold is up nearly $1000/oz from a year ago, while production costs have risen about $100-$200/oz, depending on the mine.”

All it will take is for miners to start recording massive profits next quarter coupled with lowered interest rates, and rising uncertainty.

Then gold continues to rise even more…

If you plan on investing in gold and silver, you benefit.

Another commodity also benefits.

Oil.

And that’s why Buffett recently made another big purchase of Occidental.

CNBC reports:

Warren Buffett’s Berkshire buys more Occidental after 30% sell-off from record high

“Warren Buffett’s Berkshire Hathaway purchased more shares of Occidental Petroleum after the oil and gas producer tumbled more than 30% from its record high.

The Omaha, Nebraska-based conglomerate scooped up 763,017 shares of the Houston-based energy company on Friday for $35.7 million, according to a regulatory filing. Berkshire is Occidental’s biggest investor, holding a 28.2% stake.

Shares of Occidental have fallen nearly 32% from an all-time high reached last April. The stock dropped more than 17% in 2024 as oil prices weakened.”

When the Gold to Oil Ratio is high, it indicates oil is underpriced.

That’s why Buffett bought Occidental a few years ago and then sold a bunch off.

Now that the Gold to Oil Ratio is back up, he’s buying more.

Because the ratio shows oil is bound to move up higher.

So, those buying oil companies right now may also benefit.

More By This Author:

This Trade War Might Be The Straw That Breaks The U.S. Dollar’s Back.
China Is Winning A Bigger Race Than AI
Opposites Attract: The Fed’s Bigger Concern Than Inflation