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A Word in Your Shell-Like - The Shares May Go Up on World Crises

By Malcolm Stacey | Monday 11 September 2017

Disclosure: I own shares in one or more of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.

Hello, Share Splurgers. This seems a good moment to review Royal Dutch Shell (RDSA), that huge Footsie company upon which so many pensions, insurance giants and hedge funds rely. It also happens to represent my biggest shareholding. And that, silly me, is far in excess of my usual 10% of my bag allowed to any company. Holding more than a tenth of your assets in one firm is not a safe thing to do.

The reason I hold so many Shell shares is that my hugely profitable BG holding was converted to Shell shares in that big takeover a while back. I never sold then, because Shell pays a whacking dividend of around 7%.

But as I read that more and more countries are investing heavily in renewable forms of energy like biomass, wind, solar, wave power and electric cars, I’m no longer confident in any oil shares.

But Shell should hold up in the fairly short term for these reasons. Firstly the flooding in Texas will eat into the world oil glut. Secondly, the unrest in the Middle East should also cut supplies. And thirdly, world volatility, including the scary situation in North Korea, will lead to an increased demand for oil from military quarters.

None of those reasons are at all welcome, but the price of Brent crude should rise as a result, and over the last two weeks has already started to do so. So, though there has been no RNS news from Royal Dutch Shell for some time now and third quarter results aren’t scheduled until November 2nd, I rather expect the share price to rise even faster than it has been doing. Therefore I will not sell any shares yet, and may even add to my stash.

And now to shell out in the Punter’s Return.

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