Energy

US-led Iraq should not rush into oil deals

22 Apr 2003

Iraq should focus on restructuring its oil industry, not entering into hasty contracts with majors. It is in the interests of the oil companies to be patient. Future Iraqi governments may not honour raw deals.

Enel’s new strategic plan protects dividend

27 Mar 2003

To date, a 7% dividend yield has been one of the stock s main attractions. Enel can keep that up for a while but only by using capital gains. Beyond that, operating cashflow will have to take all the strain.

Oil victory discount ousts war premium

21 Mar 2003

The price of oil has fallen by a quarter over the past two weeks. But is that premature? Global inventories are low. So any whiff of supply disruptions such as torched Iraqi oil fields sends prices soaring again.

Gas Natural bid has impact beyond sector

11 Mar 2003

For one, it highlights Spain s maze of crossshareholdings, such as La Caixa s stakes in Gas Natural and Repsol. These muddy shareholder interests and suck up capital that would be better deployed elsewhere. They should be scrapped.

Gas Natural in E24.5bn Iberdrola hostile bid

10 Mar 2003

The Spanish utility sector is hotting up again, with Spain s biggest hostile bid yet. Local rules stop Iberdrola from launching a counterbid. But another utility may step in. Then the sparks will really fly.

Enel may take stake in EdF nuclear plants

24 Feb 2003

This is part of a master plan by EdF to curry political favour in Rome for its march into Italy. But Enel investors must keep on their toes. This may give Enel cheap power, but it may not actually open the French market to competition.

Edison looks for new sugar daddy

19 Feb 2003

Less clear is why anyone would step in at this late stage in the game. It s clear why exisiting shareholders wriggling on a painful hook would want to find someone to take their place.

Italian decree opens way for Enel stock sale

17 Feb 2003

By bundling proposals for liberalising the energy sector into a single decree, Italy has fasttracked Enel s regulatory regime. A secondary Enel offering can now go ahead though the transaction may not be a straightforward one.

BP in $6.75bn deal with Russia’s TNK

11 Feb 2003

BP has not forked out a stiff premium. But it is paying a lot of cash at the top of the market. And Russia is cheap with good reason. The UK oil firm helped close the door for foreign investment in Russia after the Sidanco fiasco five years ago. It hopes to reopen it.

Shell promises to do better

6 Feb 2003

Now Shell says it will hit its 13%15% return on capital targets next year part of a broad industry shift to value and away from growth. Europe s largest oil company admits that the $16bn that it spent on acquisitions last year diluted financial returns.

Oil markets do the splits

31 Jan 2003

The presumption is that future oil prices will fall sharply, postIraq. But there are good reasons why they may not. And it looks increasingly anomalous. Crude oil prices have risen by 55% over the past year. Yet oil firms shares have fallen by 25%.

Hedge funds stuck on fence over E.ON/Ruhrgas merger

29 Jan 2003

If the deal goes through, another one is triggered: coal group RAG will buy a huge chunk of Degussa stock at a 60% premium. Legal wranglings ensure a tight finish. Degussa s current share price implies the odds of completion are 40%.

BP asset sale may start oil sector trend

14 Jan 2003

Rising exploration costs mean that oil firms can no longer chase profitability and production growth at the same time. So if profitability is back in vogue, then production can give. Oil majors are long overdue a restructuring of their tail end assets.

Opec to pour oil on troubled Venezuela waters

7 Jan 2003

The cartel says it is ready to open the taps to stop oil prices rising further due to Venezuela s general strike. Fortunately, it has enough spare capacity to meet 2m bpd of foregone Venezuelan exports. But it has little left for other emergencies.

Rising commodity prices suggest reflation

3 Jan 2003

But only at first glance. The increases are not matched by more optimistic business surveys, or even higher demand. Instead, supply squeezes are mainly responsible. Funds have done the rest of the work, betting on reflation measures yet to come.

Colaninno’s designs for Fiat gain currency

31 Dec 2002

The wily entrepreneur has laid low since selling Telecom Italia, but he s got big plans. He wants to drive Fiat to recovery. And with the Prime Minister s implicit blessing, his plans have jumped into the realm of possibility.

Fiat’s banks come out swinging

12 Dec 2002

By suspending talks to buy Fiat's finance business, they have pushed the company to the brink of a credit downgrade. That may be the idea. If downgraded, the banks can convert debt to equity, take control and fight the MediobancaAgnelli axis.

Fiat’s banks come out swinging

12 Dec 2002

Edison E2.1bn fund raising gets harder still

11 Dec 2002

The Italian group is looking to raise part of that money from the market. But its shares have fallen so much that a deep discount is no longer possible.

Edison E2.1bn fund raising gets harder still

11 Dec 2002