Words About Things

A recent report from the Norwegian oil firm Statoil suggests that the oil fields of Aldous Major South and Avaldsnes may contain double the amount of oil previously thought. A revised estimate indicates that the Aldous oil field may hold from 900million to 1.5billion barrels of oil. Although the news is predominantly centered around Swedish and Norwegian drilling operations in the North Sea, the announcement also buoyed UK operations by suggesting that the area may yet contain more undiscovered and untapped fields.

According to Statoil’s vice president of Exploration: “Aldous/Avaldsnes is a giant, and one of the largest finds ever on the Norwegian continental shelf.” The value of the find was made that much greater, due to the shallow depth at which the oil was discovered and making it much easier to extract. According to industry sources the discovery has come as a big shock, but analysts predict that there will be further investments made in the North Sea area, which should generate substantial revenues for the surrounding and participating countries.

In recent years the UK production of gas and oil from the North Sea has declined. Statistics from 2010 showed that oil production had dropped by 7.7% and gas production had dropped by 4.3%. Fortunately, for UK gas and electricity suppliers, wholesale drilling and refining companies, including BP, have recently made significant investments within the UK North Sea infrastructure. BP recently announced a £4.5bn investment in the Clair Ridge scheme and will invest an additional £3bn to redevelop the Schielhallion and Loyal fields.

In 2007 oil and gas was responsible for 36% of the UK’s energy supply. To cope with increasing demand and limitations on supply, the UK government recently released a UK energy roadmap which advocated the creation of new green energy technologies, such as solar and wind. The roadmap also detailed the coalition’s plan to redevelop the UK’s out-dated nuclear infrastructure.

In this economic climate it is interesting to see who is still making the bold moves. There is no doubt that the acquisition of Wall Street Systems by ION Trading is one such move.

ION Trading made their name as a provider of trading infrastructure for capital markets. Their purchase of Wall Street Systems seems to be indicative of a wider ambition to branch out into other areas.

What Wallstreet do largely falls under the heading of ‘treasury management‘. This extends to treasury, FX trading and also settlement solutions. Their products can be found in several central banks around the world.

It makes sense to get some things for free if you can. Why bother paying for a thing if somebody is giving it away? We are all clearly very much with the idea of free at the moment. For evidence of this, just look at the popularity of illegal downloading for films and music. Getting something for free however might not always be as good value as at first it seems.

There is a saying that there is no such thing as a free lunch, there is also no such thing as free financial advice. Worries over mis-selling by financial advisers seeking commission has led to new regulation governing the industry. It will be against the Financial Services Authority‘s new rules for financial advisers to take commission on the sales of any kind of financial product.

The Retail Distribution Review will change how consumers are able to access financial advice entirely. Financial advisers were paid commissions of up to 8% on products such as mortgages and endowment policies. Whilst this did lead to some fairly widespread incidences of mis-selling the practice did lower the cost of advice for some consumers.

Though stricter regulation is being welcomed, there are critics. For many people the cost of advice could rise. With advisers being paid by commission, those with most to invest were subsidizing the cost of providing advice to those with less. Charging a realistic amount for the time and expertise of financial advisers is likely to work out as more expensive for the less well off.

Those who have a more substantial sum to invest are set to benefit from increase in transparency across organisations.   Properly independent advice is invaluable for any one and established players such as Adam Bank have taken a strict line on this kind of thing, their financial planning page lists transparency as the reason behind theri fee based model, and promises to disclose and refund any commission gained.