• He bought Shell shares by the sea shore!

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    It is always reassuring to have one’s opinion supported by those who hopefully are more expert than you!

    British Gazette readers will recall that in December 2013 the British Gazette moved from the West Riding of Yorkshire down to Cornwall. You Editor had some financial problems and had to come up with a plan. Wishing to comply with the conventional wisdom of: “Always have a plan B” I decided to rename Plan “A”, Plan B, and put into action a new Plan “A” immediately. Plan “A” comprised:
    1. Walk down drive.
    2. Turn left and walk up Kingswood Gardens to top.
    3. Cross over main road (Street Lane) and enter Sainsbury’s convenience store.
    4. Purchase lottery ticket.
    5. Win lottery jackpot.
    Readers will see the problem. Something that physicists call causality.
    Happily, Plan “B” worked and I “downsized” from a 3 bedroom semi-detached to a 2 bed flat. The considerable difference in accommodation costs allowed me to make some investments which solved by financial problem.

    One of the three shares purchased was Royal Dutch Shell “B” when the oil price crashed so did the share price. The dividend however has not been cut – yet!

    There has a been a lot of rubbish talked of the end of oil by the green brigades. One hears green investment “experts” state that in the future vehicles will be powered by batteries. This is nonsense. The latest batteries used in such as the Nissan Leaf use materials in scarcer supply than the thick black stuff pumped out of the ground by Shell! Then we have the practicalities – the minor detail of the laws of physics. Whilst a small car can be made to run on batteries reasonably satisfactorily, the same cannot be said for commercial vehicles such as vans and lorries! And cargo ships!

    Then we have all the objects made out of plastic – which is product of crude oil just as much as petrol is! Such objects include mobile phone cases, insulation on electrical wiring, food containers…. we will stop there.

    When the Shell “B” shares crashed to £15.50, I sold the shares I had in SSE PLC making a capital gain (happily below the CGT threshold) – I had purchased the SSE shares at a low of £13.63 and more than doubled my holding making a new average RDS “B” share price of £18.65 (my new “break even” price) – the first parcel of RDSB shares were purchased at £23!

    This was and is a gamble but I am convinced that Shell’s long term profitability – now that it has acquired BG group – whereas I am deeply sceptical about the famously “green” SSE with its many wind turbines in the North Sea!
    For the report on Royal Dutch Shell’s prospects, GOTO: http://www.bloomberg.com/news/articles/2016-03-09/shell-seen-as-best-oil-major-wager-by-analysts-after-bg-deal

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