Affluent customers of a prominent American investment firm are reaping the benefits of the surge in energy prices triggered by the conflict involving Iran.
BlackRock, a leading asset management company globally, has witnessed a significant increase in its holdings in various energy corporations due to the ongoing turmoil.
While everyday households are grappling with escalating fuel costs and the prospect of higher energy bills and inflation, this New York-based multinational, managing over £10 trillion in assets for governments, pension funds, and individual investors worldwide, has seen a surge in its stakes.
Larry Fink, the chairman and co-founder of BlackRock, with an estimated personal wealth of around £1 billion, is a known acquaintance of former US President Donald Trump, having a longstanding relationship dating back to their early entrepreneurial days in New York.
The firm holds a significant stake in Centrica, the owner of British Gas, which has seen a substantial increase in value since the outbreak of the conflict with Iran in February.
BlackRock’s investments in Shell have surged by £860 million, while its holdings in BP have risen by £580 million over the past few weeks. Additionally, the company has stakes in major US energy firms like Chevron, ExxonMobil, and ConocoPhillips.
The surge in energy company shares following the conflict has been driven by expectations of substantial profits amid soaring oil prices, with North Sea oil prices hitting nearly $147 a barrel at one point.
Despite the record-high oil prices, BlackRock declined to comment on the matter, emphasizing that a significant portion of its investors are pension funds that have also reaped benefits from the rising energy company shares.
Harbour Energy, a major North Sea producer, witnessed a jump in its share price, resulting in substantial gains for its shareholders, including BASF, a German chemicals giant, which realized a significant profit by selling a stake in Harbour following the conflict.
The surge in energy wealth has sparked discussions about the concentration of power in the hands of large investment firms, with calls for windfall taxes to redistribute revenues to households facing financial challenges.
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