As the FT reports on Thursday, many investors are unhappy about the way Petrobras and Brazil’s government, the national oil company’s controlling shareholder, have handled its forthcoming share issue, set to be the biggest ever attempted.
One measure of just how unhappy investors are is the price they have paid to rent Petrobras shares to short them in a bid to push their price down. In normal circumstances, the rate is between 1 and 2 per cent a year of their current price.
When Petrobras released the detail of its capitalisation plan on September 2, the going rate leapt to about 20 per cent. It had suddenly become hugely expensive to short Petrobras, but some investors were still eager to do so.
Tudor, Pickering, Holt & Co Securities puts out a chatty research report every day, and it is worth reading. Case in point came yesterday when I came down to the header Industry response to Macondo.
It referred to a full-page advertisement in the Houston Chronicle from BP’s peers – ExxonMobil, Chevron, Royal Dutch Shell and ConocoPhillips. The ad was for the new oil containment system this group of four have agreed to spend $1bn building to ensure there is never again such a disastrous oil spill in the Gulf of Mexico. From the ad:
Engineer it. Build it. And make sure it is never needed.
But read on….
Elsewhere this Thursday:
- Q&A with the World Bank’s first clean energy tsar
- Opec’s 50th birthday: who wants cake?
- Enbridge’s quick turnaround sparks oil price fall
- Did Delaware Republican’s support for climate change legislation cost him the primary?