Member Info for chilting

We have our good news - now watch the short squeeze!!!

I certainly am not a Labour supporter but I think that Labour has certainly captured the publics mood with their current energy policy.
Labour have turned the increase in energy prices to their advantage and firmly pushed the blame on the energy companies and the Government.

The consequence is that they have dictated Government policy on the issue from Johnson's Government when the EPL was introduced until the present when any change to the policy is deeply problematic to the Government.

Going forward I don't see that this position will change, especially as Starmer is proposing increasing the scope of EPL to offset against Council Tax - a real political gimmick.

Meanwhile the NS Oil industry is caught in the middle of all these shenanigans and is being cast aside as a sacrificial Lamb.

The main achievement of Labours policy is that they have linked the issues of high energy prices and climate change to their political advantage with strong public support.
The Government realise this and basically have little option but to follow the same policy if they want to stand any chance of reelection.

mrc
I hope you are right about the EPL - you need the floor to make Enquest investable again.

As for climate change, I agree COP26 was a high water mark but the issue won't go away and as we see even more consequences of climate change the pressure to eliminate fossil fuels will only accelerate.

Good luck with that one mrc - the Government haven't the balls to make any changes to the EPL.

Today's reaction to the policy paper just shows that if the Government show any support for fossil fuels industry its political suicide.

The Government have nothing new to say about climate change - just a constant rehash - hence the apathy.

I wouldn't be so sure Kraken.
Even if they are sympathetic and see the economic need they will always put the politics first.
From their view, if that means sacrificing NS Oil and the income generated, so be it.

We saw at the beginning of the week that Mlliband was labelling today fossil fuel Thursday, I wonder what impact that had on todays report - the report seems cleansed of positive references to oil and gas. .

Its interesting to speculate how high the SP will go this time.

Last November's short squeeze took the SP to over 900p from below 500p, but that was with news of the Korean partnership.

Now if Ocado were to release some good news now....

The Government has turned its back on NS Oil but its still committed to NS Gas.
Obvious thing for Enquest is target gas, at least in the short to medium term.
Do what they do best - look for depleted assets and use their technical skill to suck them dry.

romaron
LPG isn't more expensive or dirtier - I use it for my own heating.

"LNG produces 40% less carbon dioxide (CO2) than coal and 30% less than oil, which makes it the cleanest of the fossil fuels.
It does not emit soot, dust or particulates and produces insignificant amounts of sulphur dioxide, mercury and other compounds considered harmful to the earth’s atmosphere.
Clear, odourless and colourless, LNG is typically 85-95% methane, which contains less carbon than other forms of fossil fuels. It also contains tiny amounts of ethane, propane, butane and nitrogen; the exact composition varying depending on its source and processing."

Source
https://www.nationalgrid.com/stories/energy-explained/what-is-liquefied-natural-gas-lng

This is all you have, after a quick read of the long text -

"Supporting long-term investment
The Government recognises that fiscal policy plays an important role in securing long-term
investment in the UK Continental Shelf and supporting the sector to maximise domestic
production of gas. The Government has announced a review into the UK’s long-term fiscal
regime for oil and gas, to ensure that it delivers predictability and certainty, supporting
investment, jobs and the country’s energy security."

Look from page 14
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1147339/powering-up-britain-energy-security-plan.pdf

This would be a great move forward for the whole energy industry.
Renewables are well able to hold their own without subsidy.
Now get rid of this crazy EPL and let the market sort itself out and invest for the future.

The only time subsidies will be needed now is to nurture new forms of renewable energy through R&D, such as wave power - all in the interests of energy security.

It took a while but it looks like the shorts are starting to be squeezed - 6 of the 9 are now showing a paper loss on their current positions.

https://shorteurope.com/history_company.php?selskapsnavn=OCADO%20GROUP%20PLC&land=united_kingdom

Saying they are likely to achieve less full price sales and subsequent profit is more a comment on how they expect the UK economy to perform, so they are either cautious or their economic analysts are on the ball.

Yes, unfortunately due to Next results.

Specifically this headline - " Next guides for lower profit and full price sales"

Next down around 6% last time I looked.

Sentiment often defies logic in financial markets.
This is usually the case on the upside but it can also apply on the downside as well.

As mapper points out Ocado is far from the basket most seem to think.
Sure, Ocado Retail isn't doing great at the moment but that's mainly down to the UK's poor economic performance after Brexit.
The poor sentiment is mainly a result of investors reaction to the UK economy.

Ocado is much more than Ocado Retail, its a global company, therefore, its important to look overseas for inspiration, where we are much more likely to see economic recovery than in the UK.

There looks to be a high degree of manipulation in the SP today - we could even see a blue finish???

Current profitability can be directly attributed to the current economic situation - margins are very tight at the moment.
When this eases, as inflation falls, profitability will return.

As long as current staff numbers match current demand, I don't see that overcapacity is that much of an issue.
Also at busy times of the year this overcapacity can be utilised to quickly ramp up capacity utilising temporary or agency staff - as we saw last Christmas and will also see for the Coronation.

Also its probably better to service one area of the country comprehensively rather than spread recourses thinly.
This effectively means that deliveries can be arranged in a tighter locality per delivery vehicle and partly negates smaller basket sizes.

Therefore, areas that Ocado doesn't service can wait until economic conditions ease and the Ocado Reimagined tech is enabled - this will cut the cost of the national roll out substantially.

Six of the nine headline shorts are now showing a paper loss on their latest positions - potential for a squeeze remains and seems to be growing.