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Right, Nevers, some of these new punters will stick, maybe all if they've nowhere better to go. Everyone needs household energy, candles just aren't the gear these days.
"Currently every customer is losing them money."
Probably, but not necessarily. The sale price to customers is below the *wholesale* price, but the larger companies (including Shell) will have hedged their positions to some extent and may also be trading around the structural position. As I understand it, one reason why some of the smaller players have folded is that they didn't have deep enough pockets to hedge properly.
I say this with no specific knowledge of Shell's hedging strategy for electricity, just that we have a large trading division that has considerable expertise and experience in this area for a variety of markets and commodities.
Usual disclaimer applies: this is my personal view and does not represent Shell, etc.
Hi Neversell...Are there any low gaps to fill?
Well interestingly the early trading today seems to have taken out the gap that appeared on 27th September (circled). There's a tiny discrepancy which is probably insignificant. https://invst.ly/wq2d9
A significant day for oil, with the discount of WTI to Brent increasing to nearly $5 - can't be soon enough for Biden:
https://invst.ly/wq232
Have they released their strategic reserves yet? Now may be a good time to do so for maximum effect…. pushing against an unlatched door.
Meanwhile Brent is testing the nineteen month recovery trend since it fell to $20 (blue). Will the trend hold or will Brent level off until Q1 22?
https://invst.ly/wq25z
Shell follows Brent except when it doesn't. And when it doesn't things get interesting - spot the point divergence: https://invst.ly/wq1t2
RDS has hit an interesting support level at nominally 1560 (give or take 20p) and ended the day about 50p up on what might otherwise have been expected. Whether it holds on remains to be seen - it's like a shock-absorber that's averaging out the bumps.
down more than double the drop in Shell - as I have said before, there is no exact correlation between Brent and the Shell share price.
Hi Boyo,
Hope your well. It was the Big boys at Barclays who said £30 and I still don’t think its impossible. You put oil over 80$ a barrel for a year or 18 months and who knows whats will happen.
Are there any low gaps to fill or are we clear to move upwards when all settles down?
If I were Shell I would definitely be doing a deal with the Government to take on the Bulb customers.
They know they cannot keep the price cap in its current form and that the market has to be balanced between suppliers and customers.
As with all things the market will right itself and hopefully will help progress Shell power business in the future….
"Currently every customer is losing them money."
================================================
Yep, there aren't many people that will renew on a fixed term contract, even USwitch is recommending people go onto the fixed standard tariff. Something has got to give. Not many companies have unlimited resources...apart from Shell apparently!!
Not sure how the Shell Energy CEO would get it passed by the board..."I'm going to take on 1.7 million new customers who are going to cost us at least £250m (my estimate!!) over the next 5 months....oh, by the way, can you approve my bonus payable immediately in cash....please!!"
Currently every customer that they add on price capped standard tariff will lose them money......
Currently every customer is losing them money.
long term.
Give them to your kids. If you don't have any, make a few.
i bought 500 a few weeks ago at 1640 so its more than a quid out my bag at the minute
Well £30 seems a bit far fetched NSS - not currently on my chart horizon - but today RDS hit one of my re-buy targets at 1540.
Let's just check how it's tracking Brent today:
https://invst.ly/wpwuh
There's a lovely gap up to 1640 which I wasn't expecting, so that's £1 in the bag in the not too distant methinks.
just when you thought it was safe . XMAS LOCKDOWN LOOMS. can a few del boys please cheer me up. "THIS TIME NEXT YEAR RODDERS".
Oh dear. The African bug now affecting the markets.
Never ending story.
"- if they are not willing to expand their customer base, then why bother at all."
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Currently every customer that they add on price capped standard tariff will lose them money. The market is broken.
I am split. As a taxpayer I would like Shell to take on Bulb customers to stop me paying for them. As a Shell investor I would prefer dividends rather than subsiding the ex-Bulb clientele.
Perhaps things will look different next April when the fixed tariff is due a big increase.
hi , hope your good. well id say theres more chance of boris quitting the tories + becoming the labour leader , than £30 next year , though wouldnt that be great. time will tell. but things are beginning to come together. anything on the 7 billion yet lol .
Shell energy are in the business of supply to households - if they are not willing to expand their customer base, then why bother at all.
The UK government have allocated £1.7bn (of taxpayers money) to handle the 1.7 million bulb customers that they have effectively become responsible for. I am sure taxpayers would be more than happy if Shell took on that responsibility.....I'm not sure it necessarily makes good business sense in the short term.
Would it not be beneficial in the longer term for Shell energy to allow current Bulb customers to switch to them, now that Bulb has collapsed?
Who know Char, if oil and gas stay where they are for the full 12 months anything is possible.
Some great work being done on the renewables, looks to be a decent plan…..
No way £30. Id be happy with £21 by end of 2021 .
Good to see Barclays talking about £30 Share Price.....
That will do nicely....
Great move by Shell to secure renewable electricity from Dogger Bank
https://www.marketwatch.com/story/shell-signs-power-purchase-deal-with-world-s-largest-offshore-wind-farm-271637740308
https://www.offshorewind.biz/2021/11/24/entire-output-of-worlds-largest-offshore-wind-farm-sold-out/
Just voted in the affirmative but as my 400 shares are part the almost 8 billion in existence I realise my vote will make 'so d' all difference but voting made me feel better