Energy

EU funds can ease, not end common energy pain

18 May 2022

Brussels has earmarked 300 bln euros to cut fossil fuel ties with Russia. Rising rates make cheap, repurposed Covid-rescue loans more attractive to many EU states, increasing the chance they’ll be used. But higher fuel purchases will still have to come from national budgets.

India’s energy-storage fix has virtue of speed

18 May 2022

As the West obsesses over building the perfect battery, Singapore- and Abu Dhabi-backed Greenko is launching the largest long-lasting renewable power-storage project. It’s a low-tech leap towards a greener energy system. Big customers like ArcelorMittal are lined up too.

Aramco is the old new Apple

11 May 2022

The Saudi oil company has overtaken the tech giant as the world’s largest by market capitalization, knocking smartphone maker Apple down the charts. But judging by fellow oil majors, Aramco’s value probably isn’t much different than a decade ago – it’s just more visible.

BlackRock spikes guns of green activists

10 May 2022

Larry Fink’s group will back more oil and gas production. After COP26, institutional money looked set to phase out fossil fuels, but an energy crisis has intervened. Rivals may follow the $10 trln fund giant, propping up driller valuations and complicating the green transition.

Europe may swap one energy dependency for another

9 May 2022

The bloc is ramping up investment in renewable sources to help kick its addiction to Russian oil and gas. Yet China currently controls at least 75% of the solar panel supply chain. To gain its energy freedom, Europe will also need to invest in manufacturing at home.

CATL’s woes will sap others’ batteries too

6 May 2022

The $130 bln battery maker goofed in the first quarter: net profit fell 24% and it revealed a 1.8 bln yuan derivative liability. Shrinking margins suggest its size isn’t a protection against supply chain chaos and commodity price hikes. It’s even worse news for smaller rivals.

Europe’s oil major discount grows ever more stark

5 May 2022

Exxon Mobil and Chevron trade at big premiums to Shell, BP and Total, despite all benefitting from soaring fossil fuel prices. The Americans’ slower pivot to renewable energy is one reason why. Europeans’ lucrative trading arms give cause for investors to be more generous.

Windmill makers’ vicious cost cycle has an ending

5 May 2022

Denmark’s Vestas and rival Siemens Gamesa have failed to turn booming demand for wind farms into higher earnings. Increased prices to offset soaring raw material costs will take several years to kick in. But now wind power is cheaper than fossil fuels, price pressures are easing.

HSBC breakup, Big Oil’s surprise restraint

5 May 2022

The $129 bln bank is under pressure from its largest shareholder to spin off its Asian unit. In this Viewsroom podcast, Breakingviews columnists discuss why the plan deserves short shrift. Also, the decision by oil giants to limit production will win few friends.

EU’s oil embargo is slave to volatile crude price

4 May 2022

The bloc wants to stop buying Russian exports within six months. That looks too slow to properly choke off funding for President Vladimir Putin’s war machine. Yet going any faster could make crude prices spike, exacerbating Europe’s battle against inflation.

Capital Calls: Airbnb

3 May 2022

Concise views on global finance: The $97 bln vacation-booking platform’s post-pandemic bounceback has beat expectations. It helps that CEO Brian Chesky quickly adapted the business, including cutting costs.

Russia plays the fool in its own default theatre

3 May 2022

Moscow looks set to meet foreign currency bond payments, after saying a month ago it could only pay in roubles. High oil and gas prices mean it has ample revenue to meet its obligations. But the debt grandstanding may not yet be over, notably if the EU imposes an energy embargo.

How the UK can cut power bills and go green

3 May 2022

The government is so scared of the cost-of-living crisis that it doesn’t want consumers to pay for low-carbon wins like heat pumps, even though this cuts energy bills in the long run. Instead utilities could do the job and spread the cost over 20 years, argues Hugo Dixon.

Big Oil snubs commodity shortages

29 Apr 2022

Neither Exxon nor Chevron posted big increases to production last quarter despite surges to commodity prices caused by the conflict in Ukraine. Their decision is rational based on future prices and investor pressure. But it won’t make them friends in the court of public opinion.

Africa is imperfect solution to Europe’s gas woes

28 Apr 2022

The continent’s vast reserves and growing liquefied gas supplies can cut some of the bloc’s energy dependence on Russia. Yet lack of infrastructure, domestic needs and rigid contracts limit Africa’s ability to boost exports quickly. Political instability is a further headache.

Putin’s gas shock is acid test of EU unity

27 Apr 2022

In severing Polish and Bulgarian supply, the Russian leader shattered a fragile equilibrium that had seen European energy buyers fund his war. He hopes other EU states will carry on, dividing the bloc. Instead, Europe should backstop the costly process of ditching Moscow’s fuel.

Banks enter AGM season wearing green bullseyes

25 Apr 2022

Top U.S. lenders and some European rivals face votes on their climate policies at looming annual general meetings. Banks may resist greening their loan books if that hits earnings. But even if they clear the immediate hurdle, the heat will be on to clarify their net-zero plans.

Energy efficiency starts to attract the big bucks

25 Apr 2022

Brookfield’s potential $4 bln pitch for UK boiler repair group HomeServe sounds like small fry for a group with $690 bln of funds. But decarbonising buildings is a key growth area in the energy transition. Institutional investors are manoeuvring to ensure they don’t miss out.

Spendthrift Macron will hit harsh fiscal reality

21 Apr 2022

The French president must attract left-leaning voters to win a second term, and then a parliamentary majority. But financing pledges, like big investments in green energy, will mean choosing between higher taxes and worsening public debt levels. He’s likely to opt for the latter.

Oil-field services miss brief chance to make hay

20 Apr 2022

Baker Hughes’ first-quarter earnings disappointed due to cost pressures and a fading Russian business. Growing demand for liquefied natural gas might benefit the company and its peers. But the reasons that business will thrive are the same ones that are reducing the appeal of fossil fuels.