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Wednesday newspaper round-up: North Sea, India, Greece

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21/08/2013
North Sea faces record fall in oil and gas production; bank stocks drive India shares up; Greece needs third bail-out, admits German finance minister.

Oil production from the North Sea will slump by more than expected this year and be flat in the next, according to new estimates by Oil&Gas UK.

Those revisions are the result of the latest data pertaining to the extent of the necessary maintenance and repair operations which will need to be carried out to keep ageing platforms active. Production is now thus expected to average 1.3m barrels a day in 2013, versus 1.54m last year.

Furthermore, the recovery towards output of 2.0m barrels a day has been pushed back to 2020, from 2017, which will mean lower tax revenues for the Treasury, writes The Times.

Indian bank stocks jumped on Wednesday in the aftermath of fresh measures from the Reserve Bank of India [RBI] to inject liquidity into struggling financial markets.

Late on Tuesday night the RBI announced that it would purchase Rs80bn ($1.2bn) of long-dated government bonds, along with other measures to ease pressures on banks, whose valuations have suffered as a result of the actions taken to buttress the Rupee over the past month, the Financial Times explains.

Just a short-time before upcoming elections Germany´s Finance Minister, Wolfgang Schaeuble, has admitted that Greece will require a third bail-out package. That is a deeply unpopular prospect in the central European country even if this third round of aid is expected to be much smaller than two previous ones. The European Central Bank´s Jorg Asmussen is expected to travel today to the Mediterranean country to analyse which must reform measures are necessary before a third dose of rescue funds is authorised, according to The Daily Telegraph.

Chris Leslie, the shadow financial secretary to the Treasury has criticised companies for paying bonuses to take advantage of the lower 45p tax rate which came into force in April. That may have cost the state £85m in lost revenues. According to the figures from the Office for National Statistics, banks and insurers delayed about £700m of bonuses and non-financial firms deferred around £1bn. Businesses seem to have ignored the controversy unleashed by reports – earlier in the year – that Goldman Sachs was planning to do something similar, which forced the US outfit to backtrack, The Daily Telegraph says.

For the Chairman of the Fuel Poverty Advisory Group, Derek Lickorish, ministers have a “duty” to promote the extraction of shale gas because it has the potential to drive down the cost of energy. That follows protests against drilling by exploration outfit Cuadrilla Resources at Balcombe, West Sussex. The company plans to resume exploration in the next few days. Lickorish cited a report commissioned by the Department of Energy and Climate Change which concluded that wholesale gas prices could fall by more than a fifth if shale gas production takes off in the UK and elsewhere in Europe, The Times says.

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