Iberdrola, Acciona Energía, amongst favourites to play European energies theme


Morgan Stanley | Despite Gazprom cutting the gas supply via Nord Stream 1, Martijn Rats (our Commodities strategist) believes that rationing will not be necessary this winter. However he warns that Europe could enter winter 2022-24 with inventory levels which are too low. In response to this, the European Union has suggested introducing different measures:

  1. Limit the price of electricity for the “fixed cost” energy generators,

2. Limit the price of gas, 

3. Destruction of electricity demand and

4. Measures to tackle less liquidity.

In this respect, Rob Pulleyn (our Utilities analyst) hopes that greater clarity with regard to interventions would help to reduce the uncertainty surrounding those European stocks linked to generation and energy supply.

The best ideas to play this theme are RWE and ENGIE, Iberdrola (IBE), Acciona Energia (ANE), SSE, Centrica and Drax.

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