Energy

The Biden portfolio is mainly the Trump portfolio

29 October 2020

It might matter for mini sectors, like solar power and cannabis, who wins next week’s U.S. presidential election. But as Trump’s impact on coal shows, it’s not that predictable. Instead the Fed, stimulus, taxes and the post-Covid economy are cause for an asset-allocation rethink.

Corona Capital: Utah Jazz, Comcast, Kraft

29 October 2020

Concise views on the pandemic’s corporate and financial fallout: Utah Jazz’s owners sign off with a respectable return; Comcast shoots the light out on broadband; and Kraft rides the stay-at-home wave.

BP’s investment case falls between two stools

27 October 2020

The $54 bln oil major’s shares have sunk further than peers in recent months. Boss Bernard Looney won’t mind if his renewable energy shift leads oil bulls to prefer Exxon Mobil. He might get more bothered if investors find rival Total’s green transition more compelling.

Corona Capital: Quibi

22 October 2020

Concise views on the pandemic’s corporate and financial fallout: Video streaming company Quibi’s failure is in spite of – not because of – the Covid-19 pandemic.

Iberdrola’s green deal is pricy bet on Biden win

21 October 2020

The $82 bln Spanish utility is buying U.S.-based PNM Resources for $8.3 bln including debt. Without synergies, the price looks punchy. But given wind and solar assets could get even dearer if Joe Biden becomes president and oil majors charge in, moving now has some logic.

Stored carbon could morph into investment gold

20 October 2020

Capturing and storing CO2 is expensive, judging by a new project in Norway. But the need to curb emissions is persuading states to take the plunge. The rising cost of emitting carbon dioxide means the technology may soon give investors a new regulated asset to embrace.

Guest view: Energy’s outlook is still rose-tinted

19 October 2020

The International Energy Agency’s 2020 forecast acknowledges the cheapness of solar power. But despite some progress it is yet to include a path to keep global warming to 1.5 degrees Celsius by 2050. As climate academic Sven Teske argues, the failure is part of a pattern.

Corona Capital: Soap, Zalando, Aussie oil

9 October 2020

Concise views on the pandemic’s corporate and financial fallout: Vigorous handwashing has helped Henkel’s soaps business, but not enough to offset its other bits; homebound shoppers give Zalando a boost; and Canberra may need to refine its refinery strategy.

Big Oil’s green rush needn’t inflate a big bubble

6 October 2020

Total has joined BP in promising more investment in renewable energy. The risk is that deep-pocketed interlopers push up prices of wind farms and solar parks, eroding returns. Luckily for transitioning oil majors, the scale of new capacity needed to replace fossil fuels is vast.

North Sea drillers find mutually acceptable Plan B

6 October 2020

Private equity-owned Chrysaor and listed Premier Oil are uniting in a $7 bln merger. Ideally, the former would have gone public via an IPO, not a reverse takeover, and the latter’s creditors would have avoided a haircut. But the oil price rout left both with second-best choices.

Corona Capital: NYC

30 September 2020

Concise views on the pandemic’s corporate and financial fallout: New York City’s economic reboot comes up against a new outbreak.

China’s green goal could lead to a virtuous circle

29 September 2020

Beijing’s pledge to decarbonise before 2060 requires major electrification using renewable energy. The catch is that key parts of that strategy, like hydrogen power, remain too pricey. Yet if political focus helps make them cheaper, the benefits will not just be felt in China.

Corona Capital: Shale merger, Logistics startup

28 September 2020

Concise views on the pandemic’s corporate and financial fallout: Two Permian Basin oil drillers agree to merge to share their coronavirus demand-shock woes; and delivery upstart ShipBob gets some SoftBank cash to help it compete with Amazon.

Siemens energy spinoff emits faint value pulse

24 September 2020

The 96 bln euro engineer’s energy carve-out is a curious mix of wind and hydrocarbons. Worth perhaps 17 bln euros, it will barely dent Siemens’ chunky conglomerate discount. For that, CEO-in-waiting Roland Busch needs to take a bigger knife to the remaining corporate sprawl.

Xi puts clean energy to good use beyond climate

23 September 2020

China’s president says his country will be carbon-neutral by 2060. The pledge is credible because it’s in Beijing’s interests; Xi may also be trying to warm frigid European negotiators, and defang sceptics. It’s also plausible because China is exporting pollution to poor countries.

Navalny cloud may yield green energy silver lining

22 September 2020

A suspected Novichok attack on the Kremlin critic further complicates German links to Russia via the new Nord Stream 2 pipeline. For now, gas needs mean Berlin can’t bow to U.S. pressure to ditch the project. But it should add impetus to the drive for alternative energy sources.

Review: Oil historian of record drops his compass

18 September 2020

Three decades after his celebrated history of the hydrocarbon industry, “The Prize”, Daniel Yergin has published “The New Map”. His account of recent energy geopolitics is typically authoritative. A discussion of the ongoing energy transition, however, lacks clear signposts.

BP’s wind tilt is more steady breeze than gale

18 September 2020

The UK oil major’s “green week” yielded a target of 20 GW of renewable energy by 2025. Even with a mooted $5 bln a year in investment, BP would struggle to get there via higher cost offshore wind. That’s probably why CEO Bernard Looney’s blueprint allows for a steadier pace.

Green bonds could slide into irrelevance

17 September 2020

Securities used to finance environmentally friendly investments are thriving, with everyone from JPMorgan to Germany charging in. Yet the $800 bln market does not necessarily mean greener issuers. As investors get better at differentiating, green bonds could become redundant.

BP limbers up for green transition high-wire act

14 September 2020

The UK group is the first oil major to pivot to wind and solar in a big way. To fund the shift, CEO Bernard Looney has cut the dividend and assumes higher oil prices. Even then, investors face years of relatively spartan payouts, and uncertain returns from green investments.