Fracking stocks tumble as Rishi reimposes ban
FRACKING stocks sank into the red as the ban on drilling for shale gas onshore looked set to return.
In his first outing at Prime Minister’s Questions yesterday, Rishi Sunak promised to uphold the Conservative Party manifesto commitment to impose a moratorium on fracking over fears it causes minor earthquakes.
The Tories pledged during the 2019 general election campaign that they would not support fracking ‘unless the science shows categorically that it can be done safely’. But before being replaced by Sunak, Liz Truss had planned a change of tack.
Such a move now looks less likely – hitting shares in onshore fracking firms.
As Sunak rowed back on his predecessor’s pledge to lift the ban, shares in Egdon Resources plunged 11.9pc, or 0.4p, to 2.95p and IGas Energy crashed 27.4pc, or 10.8p, to 28.6p.
IGas Energy chairman Chris Hopkinson said: ‘If this is true, then this is a slap in the face for the millions of people dealing with the energy and cost of living crises in Britain.
‘Another government U-turn risks driving investment away. If the UK decides to turn its back on shale, it would seem the UK is no longer the place for growth or levelling up or assisting hard working people with their energy bills or even reducing emissions. Instead, we will now be tied into expensive, dirty imports of LNG from Qatar.’
With the Prime Minister’s unity Cabinet assembled, Chancellor Jeremy Hunt pushed back the Halloween fiscal statement due on October 31 to November 17.
Hargreaves Lansdown analyst Susannah Streeter said: ‘Investors
are mindful that it was the unnecessary rush to announce big tax cuts which caused such tumultuous times for the Truss administration and what they crave now is caution and stability.’
The markets responded positively with the FTSE 100 edging up 0.61pc, or 42.59 points, at 7056.07 and the FTSE 250 rising 1.54pc, or 274.26 points, to 18,105.89. Sterling was also on the rise, topping $1.16 for the first time in more than six weeks.
Advertising group WPP said its global clients continue to splash out on marketing despite a cocktail of economic woes.
Revenue in the three months to the end of September came in at £3.6bn – up 10.3pc on the same period a year earlier. But the business, which won contracts from Nestle and Samsung during the period, warned the rising cost of doing business, including higher wages, could hit profits. Shares fell 1pc, or 7.6p, to 762p.
Energean rose 5.8pc, or 76p, to 1397p after it said it could start selling gas extracted from the
Karish field off the coast of Israel to its customers within days.
Pharmaceuticals giant AstraZeneca gained 2.9pc, or 281p, to 10034p after clinical trials of its Capivasertib and Faslodex drugs showed a ‘statistically significant and clinically meaningful improvement’ in the survival of breast cancer patients.
Miner Fresnillo shot up 4.3pc, or 30.8p, to 745p after it said it expects tests on its new Juanicipio mine to be completed by the end of this month.
The group maintained its guidance on silver production for this year and 2023.
Mid- cap landlord Capital & Counties rose 1.9pc, or 2p, to 104.9p after it said its £ 3.5bn mega-merger with rival Shaftesbury (up 2.1pc, or 7.6p, to 365.8p), should be completed in the first quarter of next year.
The deal, which is being scrutinised by the competition watchdog, would bring locations including Chinatown, Carnaby Street and Covent Garden under the control of a single company.