Daily Archives: January 13, 2010

By Neil Hume

Isn’t it great when City analysts think alike?

Take those who follow Shell. On Tuesday of several of them decided to cut their earnings forecasts — all at the same time.

Spooky or what?

By Izabella Kaminska

Shares in Royal Dutch Shell took a bit of a walloping on Wednesday as reports circled the city the company was guiding analysts lower on fourth-quarter numbers:

The reason for the move was seemingly a worse than expected performance in Shell’s downstream and gas operations in the period.

According to one dealer cited by Reuters, the amendment would be sizeable too:

“Consensus for Shell’s Q4 appears to be falling sharply. Lower gas realisations and losses downstream suggest earnings of around $2.6 billion in the fourth quarter versus expectations previously closer to $3.3 billion,” one dealer said.

“They (Shell) did suggest that refining margins have been very weak and also that the seasonal uplift of gas consumption we usually expect in the fourth quarter may not be so big this time,” one analysts who spoke to Shell said.

All of which shouldn’t come as a surprise if you’ve been following the oil-products and gas markets, both of which suffered uniquely grim demand over the course of 2009. A Shell-specific situation it is not.

Kate Mackenzie

BYD, the Chinese electric vehicle maker that is backed by Warren Buffett, made headlines earlier in the week by saying it wanted to go big in the US market, with plans to release its plug-in E-6 model there later this year.

Autoblog Green lists a few more details of the E-6 revealed at the show, and points out it will need to pass safety tests and change its power connector before getting the go-ahead in the US. A company executive said BYD would consider manufacturing the cars locally, should they sell well there.

As is often the case on autoblog it’s quite interesting to look at the reader comments (flouride discussions notwithstanding). There is a comparison of the E-6′s specifications to other EVs; the E-6 battery apparently has a much lower energy density than the Tesla, although the two could hardly be targeting more different ends of the EV market. And one commenter points out that there are advantages of the E-6 using lithium iron technology rather than the lithium cobalt chemistry used by the Tesla.

Still, the price will be the thing – and how it shapes up against other nascent mass-market contenders such as Nissan’s Leaf and GM’s Volt.

Related links:

Green hotrods (FT Energy Source, 30/09/09)
Replaceable batteries: pipe-dream, or the future for electric cars? (FT Energy Source, 18/05/09)

Kate Mackenzie

On FT Energy Source:

- Carbon trade wars

- Cheap commodity funding is back

- Why investors need to think about climate change

- More on UK natural gas supply fears

- Chevron’s warning not a complete disaster

- EIA forecasts and more in energy headlines

Further reading:

- The putative EPA endangerment amendment, and the lobbyists

- Nasa feels ‘plutonium pinch’ sooner than expected

- Canada’s oil bombings

- Non-Opec production soars in new EIA data

- Growth in new solar patents creeps up towards 2002 highs

- China and the US should get together on CCS development

- Is the commodity super cycle resuming?

- Crumbling reactors springing tritium leaks

- Did China wreck Copenhagen – or economists?

Kate Mackenzie

Europe itself looks unlikely to introduce a carbon border tax any time soon, with the EC’s trade commissioner-designate warning that such a move could lead to a ‘trade war’.

This is despite some powerful EU interests being in favour. Nicolas Sarkozy is calling for an EU-wide carbon tax and specifically, a carbon tariff on imports. He has vowed to press ahead with new taxes in his own country, despite a setback to those plans at the end of last year.

By Izabella Kaminska

Deutsche Bank on Tuesday revealed it was issuing “three-year market contribution securities” linked to the Deutsche Bank Liquid Commodity Index – Mean Reversion Plus.

The SEC filing, brought to our attention by Thomson-Reuters columnist John Kemp, summed up the securities as follows:

Kate Mackenzie

There has been a lot of coverage of the Kuwait Supreme Petroleum Council saying that Opec wouldn’t be alarmed if oil hits $100 a barrel – in otherwords, that the cartel is happy to let oil prices rise that high.

There’s no need to panic quite yet though: there are two reasons why Opec won’t let its production quotas destroy the nascent economic recovery – and crude remaining solidly above $100 in the near term could well do that, if you consider that was the average price in 2008.

Kate Mackenzie

Fears about the UK’s natural gas supplies are not going anywhere, despite some strong arguments that they may be a little overblown thanks to the cold snap.

The composition of the UK’s gas supply has been changing for many years as domestic production dwindles. On the one hand, gas production around the world is forecast to ramp up sharply over the next few years, but the global gas market is not yet a fungible one, though it’s heading in that direction. Will the brave new world of expanding LNG production and new pipelines help or hinder the UK (and the rest of western Europe) in securing gas? 

Kate Mackenzie

Trade war fears raised on carbon tax (FT)

Shell shifts growth aspirations away from Nigeria (Rigzone)

UK regulator foresees threat to gas supplies (FT)

China sends soldiers to load coal as freeze, snow limit supply for power (Bloomberg)

Democrats push to resist repeal of GHG endangerment finding (Argus)

US Chamber of Commerce lends limited support to Obama (FT)

China’s Yanchang to tap Madagascar oil blocks (Reuters)

US growth to move CO2 output further from Obama’s 2010 target (Bloomberg)

Venezuela starts rolling blackouts (WSJ)

California assembly committee approves oil tax bill (Sacramento Bee)

Italy’s PV solar capacity rises fast (Reuters)

US environmentalists hopeful for 2010 climate bill (Argus)

EU steel industry calls for climate concessions (Argus)

Energy Source is no longer updated but it remains open as an archive.

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