Energy

Big Oil haunted by $100 crude trauma

2 Mar 2022

Prices are high, and Russia’s 8% of global supply might evaporate, but Chevron and Exxon promised this week their focus is lower costs and returning capital. That’s a far cry from last time’s destructive investment binge. They may end up ruing missed drilling opportunities.

Capital Calls: Ford’s private equity playbook

2 Mar 2022

Concise views on global finance: The Detroit automaker’s reorganization plan makes explicit the goal of squeezing its traditional car business for cash to fund its electric future.

Chevron’s green fuel deal is cheap and cheerful

28 Feb 2022

The $276 bln oil giant is buying sustainable diesel firm Renewable Energy for around $3 bln. A solid investment return makes it financially sensible. It's also a bet on the transition away from fossil fuels. For now, though, it's a tiny one compared to Chevron's European peers.

U.N. climate report takes aim at net-zero 2050

28 Feb 2022

The world is moving too slowly to stop global warming, per the multinational body’s latest study. Ditching fossil fuels will reduce natural and man-made disasters. But too many governments and companies use the mid-century emissions targets to delay action. That’s unsustainable.

Germany is turning fiscal exceptions into the rule

28 Feb 2022

Chancellor Olaf Scholz will hike defence spending to 2% of GDP and invest 100 bln euros in the military. A historic foreign-policy shift is just the latest instance of Berlin finding ways around its budget rules. Scrapping them would be simpler given a looming energy transition.

Activist sets up Australia’s AGL for a sick burn

28 Feb 2022

Snowcap wants the power company to shelve its demerger, fend off any more lowball offers from Brookfield and adopt the latter’s plan to ditch coal. That will ultimately add pressure on AGL’s underperforming board to sell and might even result in a higher price from its suitor.

BP’s bruising Russian exit almost worth the pain

28 Feb 2022

The UK oil giant is getting out of its 20% stake in $39 bln Rosneft. Russia’s pariah status maximises the hit to its income statement. But the crisis has forced BP to take a step that could eventually allow investors to take a more generous view of its green transition.

Biden’s fossil-fuel enmity backs him into a corner

25 Feb 2022

The U.S. president’s climate stance has made him few friends in the oil patch. But U.S. drillers can fill gaps caused by Russia’s invasion of Ukraine. Expediting applications and rolling back regulations is a climbdown, but it would curb two foes: rising prices and low popularity.

American LNG burns even brighter

24 Feb 2022

Nearly 40% of European gas comes from Russia, and LNG facilities elsewhere are already largely booked. Still, the Russian invasion of Ukraine will boost booming liquefied gas exports. Replacing even part would mean long-term surety for firms like Cheniere itching to grow.

Viewsroom: Russia and Ukraine, Credit Suisse woes

24 Feb 2022

As President Vladimir Putin launches the biggest attack on a European state since World War Two and the West prepares its response, Dasha Afanasieva and Gina Chon discuss what comes next. And Liam Proud explains how an embarrassing data leak is the Swiss bank’s latest headache.

Ukraine war gives impetus to climate backsliders

24 Feb 2022

Politicians are supposed to be fast-tracking decarbonisation. Russia’s invasion may speed the long-term shift to renewable energy. But it could also empower fossil fuel fans to ease energy security fears via new supply. Investors, lured by high crude prices, may go along with it.

West has some cover to ramp up Russian sanctions

24 Feb 2022

Sberbank and VTB halved after troops invaded Ukraine, suggesting Moscow’s banks and oligarchs may end up pariahs, like the Nord Stream 2 pipeline. A Russian tit-for-tat might hit European gas supplies. The one comfort is that end of winter makes it less of an immediate problem.

Oil’s 1970s parallels overlook key difference

23 Feb 2022

Crude prices are nudging $100 a barrel, the highest in more than seven years. Geopolitical tensions, tight supply, and high inflation invite comparisons with 1973, when oil costs quadrupled. This time, however, OPEC is more likely to ease a crisis than exacerbate it.

Brookfield Aussie coal bid hits toxic smokescreens

23 Feb 2022

The asset manager and its Atlassian CEO partner’s $3.6 bln offer for AGL deserves some pushback for its scant premium and competition issues. But government scaremongering that a deal could raise energy prices throws ugly light on official resistance to the energy transition.

Risk of war implies lasting Russia discount

22 Feb 2022

Groups like Sberbank plunged after President Vladimir Putin sent tanks into two Ukrainian regions, although lame European sanctions helped them recover. Even if the Kremlin leader halts his military advance, the threat of tougher penalties will linger over Russian assets.

Brookfield drafts inspired climate-deal blueprint

21 Feb 2022

The Canadian investor and Atlassian co-CEO Mike Cannon-Brookes want to buy AGL for A$5 bln and spend up to A$20 bln more to make the coal-heavy company a renewable-energy powerhouse. It’s a potent idea that others could emulate. The price to get started will be higher, however.

EDF minorities’ cash better off in their pockets

18 Feb 2022

The 25 bln euro French energy group is raising 2.5 bln euros via a rights issue to plug holes left by plant outages and state interventions. EDF is integral to France’s nuclear power ambitions. But its issues give ample reason for non-state investors not to plough in more money.

Aussie coal exits put dithering government on spot

17 Feb 2022

Origin wants to shut the country’s largest plant powered by the fossil fuel seven years early, following rivals’ lead. It drew ire from the ruling coalition, whose green-transition plan is lacklustre. Renewables have won the economic fight; the political battle is a slower burn.

Rich stocks have yet to feel cost-of-living crisis

16 Feb 2022

Rising inflation and higher energy bills are hitting consumers. UK punters in particular look vulnerable, given uneven savings and tax hikes. Mass belt-tightening could mean fewer holidays and less spending on luxuries like streaming, hurting companies from Ryanair to BT.

Capital Calls: Theme park M&A, Energy IPO

16 Feb 2022

Concise views on global finance: Cedar Fair rebuffed a takeover offer from rival amusement park operator SeaWorld, but other buyers may be reluctant to join the ride; The $8 bln Vaar Energi, majority owned by Italy’s Eni, sees its shares dip on their first day of trading.