We would love to hear your thoughts about our site and services, please take our survey here.
The zealous drive to net neutrality is making business less competitive, hitting taxpayers, and acting as a drag on economic growth.
https://www.telegraph.co.uk/news/2024/04/19/unaccountable-net-zero-elite-has-seized-control-of-britain/
The rest of Europe, Remainers like to tell us, is forging ahead into a glorious green future while Brexit Britain is stalling, the government backsliding one by one on its net zero commitments.
It is hard to square that narrative with what’s really going on across the channel. In March, according to data from the European Automobile Manufacturers’ Association, registrations of new electric vehicles plummeted by 11.3 per cent. In Germany – the grown up country that’s supposed to show childish Britain how it’s done – the drop was even more precipitous at 28.9 per cent.
Apparently it’s not just Britain where motorists have gone distinctly cool on electric cars. The electric vehicle industry appears to going the same way as one of its own products when the battery charge lowers: it’s slowing rapidly to a crawl.
And it’s plain to me that the reasons in Europe are the same as they are here: electric cars are too expensive to buy, and too fussy to recharge. They have a niche as local runabouts for people with their own off-street recharging facilities, but little appeal otherwise. Enthusiasts will point to te example of Norway, where the vehicles have a 90 per cent share of the market, but that exception merely demonstrates what has been clear for a while: people buy electric cars when the government rigs the market in their favour
In Norway, buyers of EVs pay less VAT, are given access to bus lanes or free parking in various regions, pay lower road tolls and are given the right to charge their vehicles if living in apartments. Add to that the government mandating that cars purchased in public procurement need to be zero emissions, and it’s not hard to see why sales are high.
Elsewhere, however, takeup is more moderate, and the EU’s dislike of cheap Chinese imports certainly isn’t going to help. The European Commission is currently considering whether to jack up import tariffs. This is necessary, it says, because the Chinese government is plastering the industry with unfair subsidies.
In other words, the EU is telling motorists that it wants them to go electric, but when cheaper imported products arrive on the market making it slightly more affordable for them to do so, it it cracks down on those imports.
It isn’t just electric cars, though. The EU is full of bluster when it is setting net zero targets, but arguably no more enthusiastic than we are about hitting them. Less so, even. Germany has a net zero target date of 2045, five years earlier than Britain, yet it has reopened coal mines.
Moreover, it’s wriggling out of its electric vehicle targets. Thanks to German carmakers, internal combustion engines will still be acceptable so long as they are capable of running on bio- or synthetic fuels. And thanks to German homeowners, the ban on gas boilers were also watered down. The problem, in other words, is not that Brits are lousy environmentalists. It’s that once again, Net Zero is collapsing as t
Https://www.telegraph.co.uk/business/2024/04/18/charts-show-scale-europe-electric-car-crash/
As long as they are heavily subsidized by taxpayers' money :
Electric car demand plunges across Europe
Electric car sales plummeted across Europe last month as demand dried up despite the EU’s push to ban petrol and diesel vehicles by the middle of the next decade.
Sales of battery-powered cars dropped by 11.3pc as demand in Germany, Europe’s largest economy, plunged by 28.9pc, according to the European Automobile Manufacturers’ Association (ACEA).
Only 13pc of new registrations were electric, down from 13.9pc in March last year and down from 14.6pc for all of 2023.
Sales of electric cars have stalled despite Europe’s plans to ban the sale of new internal combustion engine cars by 2035.
From the article in Energy Voice about Hartshead Resources :
In the run up to a looming general election, with Labour leading the polls, Mr Lewis said fiscal uncertainty damages not just jobs and investment but receipts to the Treasury to fund public services.
“Jobs are really important. Labour should be about protecting jobs more than anything else, that’s where the Labour Party came from, protecting workers, came out of the trade union movement. This does not do that, what Labour are doing at the moment.
“It doesn’t protect jobs today, and it doesn’t protect jobs in the future because there will be companies that will not be able to survive the period between now and when we have full energy transition jobs in floating wind, CCS, and hydrogen.
“We need to preserve the supply chain and the skilled workforce today to have those available for tomorrow.
“That’s nothing to do with the difference between oil and gas. That’s just about solid industrial strategy.”
The industry has repeatedly pointed out that oil and gas giants’ profits – like Shell, BP or TotalEnergies – are driven by areas outside of the UK and are not made here, despite rhetoric to the contrary from politicians, NGOs and parts of the media.
Mr Lewis added: “When Labour came out and said we’re going to “close the loopholes that returned cash to oil and gas giants”, they were effectively damaging oil and gas minnows and mid cap companies, you know from Harbour and Serica all the way down to us. These aren’t oil and gas giants that they’re having a punitive impact on.
“And so I think the rhetoric is really unhelpful and I think there’s just no recognition of what oil and gas has brought to the UK in terms of, you know, jobs and industry, receipts to the Exchequer, energy security, and it would be nice to see a little bit more balance in the rhetoric.”
Britain is incapable of building the wind farms, solar farms and transmission networks essential to net zero, a government report has warned.
A shortage of ships, steel and concrete in the quantities needed to build new infrastructure casts doubt over government targets to decarbonise the energy system, according to a study by management consultancy Baringa.
The problem is compounded by a shortage of skilled workers who can install the new structures.
https://www.telegraph.co.uk/business/2024/04/17/britains-shift-net-zero-threatened-shortages/
U.K. engineering and oilfield services firm John Wood Group (OTCPK:WDGJF) (OTCPK:WDGJY) should either move its listing on the London Stock Exchange to the U.S. or consider a sale, activist investor Sparta Capital Management said Tuesday.
Wood's (OTCPK:WDGJF) (OTCPK:WDGJY) shares have fallen a third to all-time lows since Apollo Global Management abandoned its attempt to buy the company last year, but traded +1.5% in London following Sparta's letter to Wood's board.
Sparta founder Franck Tuil said he was "frustrated" by the stock's continued underperformance, and "if the U.K. public markets are unwilling or unable to engage in Wood's story, we believe you should undertake a strategic review and actively seek alternative solutions."
Tuil said it is "time to recognize that the next chapter of Wood's journey could be best supported by different owners," and urged the company to "explore the best way to maximize shareholder value, including a sale of the company."
Sparta said the company has begun a turnaround but the share price is struggling under the "U.K. mid-cap curse."
U.K. stocks have lagged the valuations of U.S. peers, causing frustration among executives and investors, including at Shell, whose CEO said recently the company has "a location that clearly seems to be undervalued."
Wouldn't this be one of the reasons why ENQ wants to ditch the GE-stake?
https://www.energyvoice.com/oilandgas/north-sea/551646/the-threat-alone-is-something-security-experts-weigh-chinas-role-in-north-sea/
"Strain in the relationship between China and the UK has raised concerns about whether Chinese state-linked companies like CNOOC pose a potential threat to the UK’s energy security.
The UK and the EU have both taken recent actions against Chinese groups, ranging from accusations of cyberespionage to dominating energy supply chains. Against a backdrop of the Russian invasion in Ukraine, the role of foreign companies controlling energy infrastructure is coming under scrutiny. This is especially true for the UK, as the last decade has seen Chinese companies gain a larger presence in the North Sea."
"The issue is not a new one – politicians have warned that Chinese companies working in the North Sea pose a threat to the UK’s energy security. In 2023, chairman of the cross-party policy group Inter-Parliamentary Alliance on China (IPAC) Iain Duncan Smith said the government was “failing to take seriously” the energy security threat posed by the involvement of China-backed groups in the UK’s oil and gas sector."
Other news, probably not so important : Steve Bowyer is appointed to the OEUK-board
https://www.energyvoice.com/oilandgas/551724/oeuk-appoints-trio-of-north-sea-bosses-to-its-board/
Britishvolt’s gigafactory site sold off in electric car blow
US private equity investors have bought the site of what had been hoped would become Britain’s first electric car battery gigafactory in a blow to Britain’s net zero ambitions.
Land in Cambois near Blyth in Northumberland had been expected to become the home of the £3.8bn Britishvolt factory before the company fell into administration last year.
However, Northumberland County Council revealed it has sold the site to Blackstone, which plans to turn the site into a data centre.
Britishvolt, which was backed by mining giant Glencore, collapsed with the loss of more than 200 jobs and had been in line for £100m in funding from the Government via its Automotive Transformation Fund.
"The claim that abandoning fossil fuels will make this country safer in a hostile world is a perversion of reality; it should be treated with contempt. "
https://www.telegraph.co.uk/news/2024/04/15/true-british-patriots-have-gas-boilers-and-petrol-cars/
In US not so different : Bets against energy stocks were higher at the end of March. Average short interest across energy stocks in the S&P 500 index rose 14 basis points to 2.56% of shares floating at the end of the month from February end.
Oil, Gas, and Consumable Fuels remains the most shorted industry within the energy sector, with 2.66% short interest as of March-end, up from 2.50% at the end of February. Energy Equipment and Services was the least shorted industry within the sector, with 2.07% short interest as of March-end, up from 2% during February end.
1) With the exception of the Saudis, the OPEC+ cut is not real. Supplies are higher than what's being penciled in, so the risk of supplies surprising to the upside is significantly lower than what people think.
2) US oil production growth is nowhere near what headline figures show. As a result, the decline will be larger and more severe than people expect. This will directly impact how we exit 2024 and 2025.
What Does that Mean for Price?
Even with our variant perception, we still see oil prices being rangebound this year. Why? Because the Saudi cut is real and they have every incentive to start unwinding it by H2 2024. This means supplies could surprise by ~500k b/d to ~1 million b/d.
This year is an election year and if oil prices get too hot, the US could use SPR again to combat higher prices. China is also capable of releasing SPR this year, which could complicate things.
However, once the market sees what we are seeing, the unwinding of the voluntary cut will be bullish for balances in 2025. People will realize that this production cut is not real, and the reversal of it will have no real impact on the market. Analysts will have to readjust their modeling for 2025 and oil traders will see that despite the production increase, exports are the same. Physically and financially speaking, oil prices will get a tailwind because of this (unwinding of the voluntary cuts).
Lastly, because of the overstated growth in US oil production, market participants will be surprised to see both the drop in US oil production this year and the subsequent lack of growth. This will alter people's perception of supply growth in 2025. Once US shale production peaks, non-OPEC supply growth also peaks. The peak supply thesis is going to come much sooner than the peak demand thesis.
What does it mean for price?
It's going to be a lot higher than $90/bbl WTI.
https://seekingalpha.com/article/4683659-two-variant-perceptions-in-the-oil-market-today-and-why-they-are-so-important-for-where-we-are-headed
"
As rising oil prices complicate the UK’s escape from this ghastly cost of living crisis, it was noteworthy a British energy company announced last week it is to start drilling at the biggest oil field discovered in the North Sea in at least 20 years.
EnQuest plans to bring two fields onstream with the potential to produce 500 million barrels of crude over coming decades. This reignites the political battle over the UK’s energy future, with the Tories having just extended the 75pc “windfall levy” on North Sea output and Labour threatening to block new production completely, citing environmental concerns.
This makes no sense. There are around 300 active North Sea oil and gas fields, over half of which will cease production by 2030. The North Sea currently delivers the equivalent of 83pc of UK oil demand and 54pc of our gas use. What are our plans to replace those supplies?
Even the Climate Change Committee, the official green watchdog, acknowledges fossil fuels will still account for around half of Britain’s energy needs by 2030 and a quarter by mid-century. And that’s if the proposed net zero 2050 transition to renewables is achieved, which looks pretty unlikely.
So if that’s the case, that we’ll be using oil and gas for at least the next three decades, why not drill our own? Even if such energy is exported, at least UK energy workers would keep their jobs and the Treasury would get the tax.'
Ready reserves can cushion the blow – but only if we are prepared to use them.
Hoping the narrative keeps changing...
https://www.telegraph.co.uk/business/2024/04/14/britain-north-sea-oil-resources-protect-rising-fuel-prices/
Guessing a SP for ENQ or other British oilers is a fool's errand as politics and enfollowing money streams play such an important role. I can only say our actual valuation is abyssmal. I even don't want to start comparing our valuation to that of US mid- and small cap oilers. A small French oiler with operations in "risky" jurisdictions -that is my sarcasm, sorry- of Tanzania, Gabon and Angola that is only pumping 28 000 BoE/d has a market cap of 1.28 Bn euros and net debt of $ 120 million, they had FCF of $157 million. Wowwowwow!!!!
How strange how sentiment turns. Someone -i won't mention his name- who has been calling names at "stupid" Enquest just few weeks ago because of the share price not following the operational excellence would not object to a big acquisition by ENQ now and wouldn't mind the share price reaction down....I own several millions of shares and would object being buried under a new debt burden, i can assure you. LTH 's have paid 21 p merely for the Golden Eagle acquisition...