By relocating to the US, Shell can conveniently avoid those green activists who dare to question their saintly practices.

Posted by John Donovan 12 June 2023

Shell, the beloved and environmentally conscious oil giant, is considering a radical move that has brokers buzzing with excitement. Can you imagine the audacity of Shell leaving the majestic streets of London? Unthinkable, right? But hey, they already surprised us once when they left The Hague for the UK back in 2021. So, who knows what their next unpredictable move will be?

Forget about green policies, shareholder satisfaction, or investing in new oilfields. According to some brilliant minds, the new CEO Wael Sawan must tackle a far more critical issue at Wednesday’s capital markets day: location. Yes, you heard that right. The location of Shell’s headquarters seems to be the pinnacle of concern for these innovative brokers.

Citigroup, in all its wisdom, believes that Shell’s decision to hold a presentation in New York is a clear indicator that US investors are far more engaged in energy matters than their European counterparts. Who needs European investors anyway? But hold on, are these “more engaged” US investors truly capable of engineering a miraculous re-rating? Apparently, Shell’s European domicile needs to be questioned and discussed ad nauseam to satisfy their insatiable curiosity.

And wait for it, esteemed Deutsche Bank has a similar revelation! They emphasize the “different approaches to decarbonisation” between European and US oil sectors. Shocking, isn’t it? It seems these bankers want to tell oil companies how to run their business, as if they are experts in the field. The cherry on top is the remarkable valuation disconnect between the two sub-sectors. Who needs a logical explanation when we have valuation discrepancies?

These fantastic brokers are suggesting that if Shell were to move its listing and HQ to New York, their valuation could magically double, just like that! Look at their American pals Exxon and Chevron, valued at six times their cash flow while poor Shell lags behind at a mere three times. Can you imagine the possibilities? Based on their cash flow of US$46bn, that’s an extra £110bn on the current market cap. A significant upgrade indeed! But hey, who needs accuracy and solid reasoning when you can dream up imaginary numbers?

Oh, and let’s not forget the icing on the cake. By relocating to the US, Shell can conveniently avoid those green activists who dare to question their saintly practices. Remember that court case in the Netherlands? Yeah, Shell doesn’t want to deal with that anymore. Clever move, Shell! Give them a round of applause.

Sure, there were rumors that Sawan rejected a move to the US when they decided to shift to the UK two years ago. But times have changed. Windfall taxes are rising, retail supply businesses in Europe are being abandoned, and who knows what kind of oppressive regulations Labour might impose if they are elected. Sawan better come up with a compelling answer to the question about their potential move because, you know, it’s definitely going to be asked. No doubt about it.

So, let’s cheer for Shell’s brilliant strategy! Moving to New York, boosting profits, and escaping environmental scrutiny—truly a masterstroke. Shell, you never cease to amaze us with your relentless pursuit of profit and your unwavering commitment to the planet. We can’t wait to see what other miracles you have up your sleeve.

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