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Oil prices continue to bounce about with every speech and social media post put out by the Iran war’s belligerents [writes The Frugalist, who has the reins this weekend].
But the overall trend for prices is upwards [3]. And that means increasing financial pressure on energy-intensive businesses and the electricity grid more generally.
Especially when you consider that the Strait of Hormuz [4] normally carries a fifth of liquefied natural gas (LNG) exports.
Think back to 2022 – LNG was cited [5] as a key solution to the challenge of weaning off Russian gas imports.
Oh dear!
President Trump has praised [6] the UAE’s decision this week to leave OPEC. But whatever happens with the oil cartel is unlikely to reverse the prices for gas and oil while conflict continues in Ukraine and Iran.
Besides, we have known for a long time that with growing global energy demand, a limited supply, and the increasing expense of extraction, fossil fuel prices would likely increase.
Okay, there might be the occasional reprieve. (More fracking, anyone?) But oil is never going to be cheap and abundant again.
Heating hurts
The situation is worse if you rely on physical fuel delivery to heat your home.
The UK government can’t fix the geopolitical issues, but at least it has expanded its Boiler Upgrade Scheme. This will now provide up to £9,000 in grants [7] for households that use heating oil or liquefied petroleum gas to switch to heat pumps. This is separate from the direct funding [8] for affected households that comes via local authorities.
How many such houses will prove suitable for getting the best out of a heat pump is a different question, however.
Can solar rescue us?
I’ve looked into solar myself on multiple occasions. Not because it makes a compelling alternative to investing in a global ETF, but because I like the principle of DIY-ing my own energy production. Saving on energy bills would justify the expenditure.
Now, solar panels have been plummeting in price. But installation costs are still a problem.
In fact when it comes to my own house, the scaffolding is so complex that I’d be several thousand pounds down before I’d even bought a panel.
Germany has led the way [9] with a cheap and cheerful alternative – plug-in solar, where panels are plugged into an inverter and then directly into your mains. The electricity generated then flows to where it’s needed, without electricians, dedicated circuits, or formal declarations [10].
You’re free to put such panels on fences, shed roofs, or even to mount them on a wooden frame. (I can foresee my DIY skills and a large bucket of nails coming in handy again!)
The media has been getting into the question of whether plug-in solar is economically worthwhile [11].
But other, more thorny issues remain. Such as whether the panels present a safety risk [12] – especially given British electrics have oddities that other countries haven’t had to worry about.
Solar flares
I’ve noticed more than a few people seem to have decided to jump straight in with plug-in solar, even before government legalisation. Many vendors report they’ve sold out.
This may prove premature. I expect home insurers will be paying especially close attention to fires with large claims attached to see if unapproved inverters were plugged into the mains.
Also, if plug-in solar is only an option for homeowners and not the rental sector, then that will limit their beneficial impact. Figuring out a balance between making plug-in solar safe, not exposing landlords to liability, and enabling renters to install their own panels will be tricky. And I expect the government will still get some flak for not doing it quickly or safely enough.
Admittedly, fitting a few hundred watts of solar panels to hundreds of thousands – even millions – more homes won’t instantly get us off fossil fuels.
But even if it looks like plug-in solar will take a few years to pay off financially, as soon as the standards are approved and the safety aspects sorted, I’ll be at the front of the supermarket queue for my kit.
Hopefully, just in time to pair some panels with the summer BBQ.
On that note, I hope you have a great Saturday!
From Monevator
Handbags at the dawn of the AI era – Monevator [13]
Cash total returns: a long run index for DIY investors – Monevator [14]
From the archive-ator: Reasons to rent a house instead of buying – Monevator [15]
News
Bank of England votes to hold base rate at 3.75% – The Intermediary [16]
High Street sales in biggest drop for more than 40 years… – This Is Money [17]
…with stalwart outlet Claire’s closing 154 stores – This Is Money [18]
Pensions Schemes Bill moves forward with ‘guardrails’ – Pensions Age [19]
Edinburgh Worldwide admits defeat to Saba Capital – City AM [20]
British Airways owner to raise air fares as fuel soars – This Is Money [21]
BP profits more than double as Iran war sends oil prices higher – BBC [22]
UAE quits OPEC – Sherwood [23]
[24]
Savers still love their cash ISAs – Simon French via X [25]
Products and services
Disclosure: Links to platforms may be affiliate links, where we may earn a commission. This article is not personal financial advice. When investing, your capital is at risk and you may get back less than invested. With commission-free brokers other fees may apply. See terms and fees. Past performance doesn’t guarantee future results.
NS&I’s new fixed-rate savings accounts pay up to 4.5% – M.S.E. [26]
Mortgage borrowers ‘left in limbo’ by Bank Rate freeze – Moneyfacts [27]
Get up to £1,500 cashback when you transfer your cash and/or investments to Charles Stanley Direct through this affiliate link [28]. Terms apply – Charles Stanley [28]
What life insurance actually costs – Which [29]
Middle East crisis: will your travel insurer cover you? – M.S.E. [30]
Get up to £200 cashback when you open an Interactive Investor [31] SIPP. Terms and fees apply, affiliate link – Interactive Investor [31]
Saving with eSIMS for travelling abroad – Be Clever With Your Cash [32]
What’s happening to house prices? – Which [33]
Grade II-listed homes in England, in pictures – Guardian [34]
Comment and opinion
Banning payment for order flow is an EU blunder the UK shouldn’t repeat – City AM [35]
Why private equity is likely in worse shape than private credit – Verdad [36]
Diversifying during periods of positive stock-bond correlation – 7 Circles [37]
Politics could push UK bond yields higher… – ING [38]
…or has the gilt sell-off already gone too far? – JP Morgan [39]
Naughty corner: Active antics
Are investors over-valuing Corning’s AI infrastructure business? – Morningstar [40]
Seagate’s value continues to soar – Yahoo Finance [41]
Tech stocks suffer after reports that OpenAI missed key targets – Sherwood [42]
Will emerging market pioneer Mark Mobius be vindicated? – Morningstar [43]
Prediction markets racing to ban insider trading – Fortune [44]
The 15 stocks that returned the most over the past decade – Morningstar [45]
Running away with it mini-special
How the two hour marathon barrier was broken – The Conversation [46]
Adidas shares rise in wake of London Marathon sensation… – This Is Money [47]
…though investors need to watch out for Chinese competitors – BBC [48]
Kindle book bargains
Antifragile by Nassim Taleb – £0.99 on Kindle [49]
The Big Short by Michael Lewis – £0.99 on Kindle [50]
The Art of Statistics by David Spiegelhalter – £0.99 on Kindle [51]
Not the End of the World by Hannah Ritchie – £0.99 on Kindle [52]
Or pick up one of the all-time great investing classics – Monevator shop [53]
Environmental factors
Air pollution during pregnancy may harm babies – Guardian [54]
European sea temperatures reach highest levels recorded – Guardian [55]
UK supermarkets to start selling plug-in solar panels… – The Independent [56]
…but legislation might be needed to ensure renters can benefit – i Paper [57]
Plug-in hybrid cars can be surprisingly expensive to run – This Is Money [58]
US is making Europe pay for its half-hearted electrification… – Geoeconomic [59]
…though the UK broke its solar generation record again – PV Magazine [60]
Robot overlord roundup
White House memo claims mass AI theft by Chinese firms… – BBC [61]
…while China blocks Meta’s purchase of Chinese AI firm – Reuters [62]
Microsoft’s GitHub shifts to metered AI billing amid cost crisis – The Register [63]
Can AI predict fund managers’ trades? – K.O.I. [64]
Microsoft and OpenAI loosen ties – Spyglass [65]
Switching AI vendors at scale isn’t easy – The Register [66]
Not at the dinner table
US charges ex-FBI director James Comey for an Instagram post – Guardian [67]
King Charles’ subtle but striking warning to America – CNN [68]
How Péter Magyar toppled Viktor Orbán – The Bulwark [69]
Hungary’s business elite pivots away vanquished PM [Paywall] – FT [70]
Russian super yachts skip the Hormuz blockade – BBC [71]
Off our beat
Electronic warfare is sowing confusion in cockpits – CNN [72]
Australian teens say social media ban is not working – Fortune [73]
What does the Zoological Society of London do? – Guardian [74]
The gamers who lost money on Peter Molyneux’s last project – Ars Technica [75]
Why low-frequency sound might explain haunted houses – Sci News [76]
And finally…
“In most of our decisions, we are not betting against another person. Rather, we are betting against all the future versions of ourselves that we are not choosing.”
– Annie Duke, Thinking in Bets [77]
Note this article includes affiliate links, such as from Amazon [78] and Interactive Investor [79].
Weekend Reading – featuring the week’s best money and investing articles from around the web – can be read by any logged-in Monevator member [2]. Alternatively please subscribe [1] to our free email newsletter to get future editions direct to your inbox.