Slow economic growth with inflation – stagflation – could result from the surging price of oil. Markets are mesmerised by the thought that as we go into winter in the Northern hemisphere oil is heading towards $100-a-barrel. The chart above shows Brent crude is in the mid-nineties as the Saudis are determined to push prices higher. The US is now insulated by domestic fracked shale oil supplies and the dollar has become a petro-currency as a result. Campaigners today again won permission for yet another hearing to challenge and delay the go-ahead to build the Sizewell C Nuclear Power Station. Thanks to anti-frackers, anti-nuclear campaigners, and Net Zero zombies, Britain’s energy insecurity has increased.
Oil prices will add to the political miseries facing Sunak as he decides whether to go for a May election before things get worse, or play it long in the hope that things get better. He’s caught between an unfracked rock and a hard place…
Following on from yesterday’s good news on testing ramping up now the private sector has been brought in, here is another innovation by the private sector to match buyers and sellers of PPE supplies in a market place. PPEexchange.co.uk was created in 7 days – as a free site to get PPE buyers and sellers in touch with each other and get supplies to the care providers. The software developers did the work for nothing and have the support of both the CBI and GBM union. PPEexchange has been designed, built and developed by and will be supported by PPEx Limited and Shoothill on a pro bono basis. Aimed at the social care sector it is open to users from all sectors as a free resource for their benefit and the good of the wider community.
With time being of the essence now and for the foreseeable future if shortages and bottlenecks can be eliminated, new alternative suppliers sourced and connections made it will in the end save lives. Once again proving that free markets can do what the centralised planners can’t, match supply and demand efficiently, driving down costs and optimising supply chains…
The government is moving closer to imposing a new energy price cap meant to benefit middle income households (a price cap for low income households already exists). The Domestic Gas and Electricity (Tariff Cap) Bill is likely to be made law this summer. A new cap could be in operation by this winter. The law will require Ofgem to impose the cap on standard variable tariffs which will affect about 11 million contracts. The government claims the cap will save households up to £100 a year (or £8 a month)…
Last month Argentina’s government, led by a centre-right party, abandoned energy price caps, deeming the policy to have failed. Argentina deployed heavy state subsidies in electricity markets and set prices for consumers; as a result investment in the energy industry plummeted, the country lost its energy independence and power outages became frequent. Excitable investment notes are circulating in the City praising competition-focused free market energy reforms in that country and others. In the UK, the Competition and Markets Authority undertook a two year study and concluded it would advise government against price capping, which squeezes out smaller suppliers who require flexibility on price, entrenches the position of the big six and acts as a disincentive for consumers to switch suppliers so as to find the best company for them. That Tory manifesto opposition to ‘untrammeled free markets’ in action…
The day before Donald Trump won the presidential election market research firm Opinium reported: “the majority of UK financial advisers believe a Trump victory will adversely affect investments“. It went on: “four out of five (80%) financial advisers take a negative view on a Trump win when it comes to investments… only four per cent believe Trump would have a positive impact on the market”. Since then, investors on both sides of the Atlantic have been profiting from the “Trump rally”, “Trump bump” and the “Brexit boom”. Yesterday the FTSE 100 soared to a new record high for the eleventh consecutive day of trading. In the US, the Dow and the S&P 500 have both hit record highs. Experts…
