AUSSIE WORLEY PARSON’S MOVE: INTO THE US AND DEEP INTO OIL

FLIGHT Centre shares have fallen as much as 12 per cent after the travel company flagged a lower profit from its Australian business and warned rising oil prices could hit airfares.

Managing director Graham Turner says wage negotiations and the impact of an ABC report alleging it underpaid staff and overcharged customers had hit its local unit.

“Australian profit is currently down compared to the same period last year,” Mr Tur- ner told Flight Centre’s annual general meeting yesterday.

“We believe the disruption is now abating and that this, coupled with various other initiatives and refinements that are underway, will lead to better second half results.”

Management expects underlying profit before tax for the six months to December 31 of between $140 million to $150 million, compared to $139.7 million for the first half of FY18.

That indicated underlying profit could be flat or rise as much as 7 per cent.

Investors were unimpressed, sending Flight Centre shares to their lowest since January.

At 1230 AEDT, they were down $4.275, or 8.35 per cent, at $46.915, having been as low as $45.05 earlier yesterday.

Mr Turner also flagged uncertainty overseas due to the UK’s tumultuous negotiations to exit the EU and rising oil prices.

“It’s likely ... that airfare prices, which have remained fairly stable, will come under pressure if oil prices continue to rise,” Mr Turner said. THE $4.6-billion Worley Parson’s move across the Pacific is not only big – the biggest by an Australian-based company - it is also fascinating, intriguing and indeed extremely instructive.

The timing was also exquisite if entirely accidental, coming as it did straight after the Wentworth by-election – and that ‘accidental death’ in Turkey.

A few thousand pampered inner city harbourside and beachfront delusionals might have voted for a future of windmills and solar panels and power blackouts.

But that’s OK – for them; they could afford to copy former SA premier Jay Weather-dill by buying big batteries and diesel generators.

In sharp contrast, the major shareholders in Worley are making a big statement that reality, as contrasted with fantasy, is a strong and continuing growth future for fossil fuels – and not just oil and gas, but base-load coalfired power generation.

Worley has already become an ‘interesting’ company with the previous replacement of its controlling – and founding shareholder - John Grill by the very private multi-billionaire Lebanese Shair family’s Dar Group, with its key linkages and business operations through Dubai and Saudi Arabia and out across the world.

The move will very substantially beef up Worley Parsons from its existing operations in the US and Canada, while broadening its existing presence in Asia, the Middle East, the UK and Europe. goods and the like.

So in a very real sense of committing $4.6 billion of their and other shareholders’s money, WP and its major shareholders have ‘seen the future’ and the future they see uses more and more oil and gas.

They want to be part of that development and to help feed the steel mills and coal-fired power stations to provide cheap and reliable base-load power.

The Lebanon-Saudi-Dubai relationships are critical to the Shair family’s Dar group, but are more incidental to WP and will be further diluted operationally by the US expansion.

But obviously Saudi oil remains a cornerstone of global energy - even in the US despite the development of shale which had made the US not just fully self-sufficient in hydrocarbons but now also a net and likely growing exporter of gas.

As a consequence, not exactly incidentally, the US has become one of the only major economies to have actually significantly cut emissions of CO2, and cut them in the context of a growth economy!

President Donald Trump has walked away from the fake Paris climate accord and will more than deliver on his predecessor’s commitments.

China and India will stay in Paris – and ‘deliver’ diddly squat in CO2 emissions reductions.

Hmm, maybe there’s a lesson for Australia in that. That’s if there’s anyone with a brain and a spine left in Canberra after last Saturday