The British Medical Association, or at least its top dogs, would like the UK to stop all exploration in the North Sea “immediately”. Alongside the Royal colleges of physicians, obstetricians, gynaecologists, psychiatrists, paediatrics and child health, they have decided that fossil fuels pose a “grave threat to our patients.” The Times reports that the colleges have clubbed together and written as much to the Prime Minister.

Between them, these fine institutions can muster a quarter of a million members, although it is not clear how many of them would agree with the extreme measure that is being proposed on their behalf. Some of them, at least, might consider there are rather graver threats to their patients. They might have noticed that the UK’s dependence on imported energy is stoking a cost-of-living crisis which will make their patients poorer and which promises to add immeasurably to the workload of the medical profession.

As they pull on their (synthetic) scrubs and gowns in theatre, or break out sterile implements from sealed plastic bags, or clean surfaces with antiseptic or merely ensure that the patient has a chair to sit on while she waits, they might wonder what all these things, ranging from convenient to essential, are made from. Only the dark greens believe that wind and solar can replace oil (wind contributed 4 per cent of UK primary energy supply last year). Their policies would make us all too poor to support today’s health service, let alone the quarter of a million members of its professional bodies.

If the oil does not come from the North Sea, or the gas from the UK, it is another import that has to be paid for. Those payments might go to finance a despotic regime which was not much interested in grave threats to its citizens or to any others, and which might suddenly decide to invade a neighbour, or stop supplying fossil fuel to the UK. As we are discovering, energy security is more than a question of price.

Still, who knew that the expertise of these magnificently qualified elites extended so far? Few of the leading experts in the energy industry would venture an opinion on obstetrics or gynaecology. In return, a decent period of silence on the future of oil, and less gas from the medical experts, would be appreciated.


It was a nerve-wracking time for us holders of British American Tobacco, as the share price fell to a point where the dividend payments would buy the entire business in less than nine years, a strategy first suggested by Olive Tree Investment to the company’s board last year, in response to the relentless price decline. Last November, the shares hit £25, the worst for a decade, where the yield was 8.5 per cent.

BAT was the tar baby (sic) that nobody wanted to be seen holding. Killing the customers was not seen as an attractive strategy (never mind that the business came high up in one ESG league table), and the big holders were mostly tracker funds which had no choice, given the company’s size, but to hold the stock.

Justin Webb live in conversation
Justin Webb live in conversation with Iain Martin – 22 February 2022, 6:30pm

In hindsight, all this added up to a fine case for buying the shares, and they have since risen to nearly £35, for a market capitalisation of £79bn. The dividend has been raised, but the yield is still 6.3 per cent, and BAT is following fashion with a buy-back. There was little coverage of last week’s results, as if the distaste for tobacco had permeated the newspaper offices, one concluding that “the more scrupulous can harvest returns from the moral high ground by using their votes to nudge businesses towards more ethical métiers.”

The danger is that this might have some effect. Oil companies find and sell oil. Tobacco companies sell tobacco. It’s what they do. The moral pass was sold decades ago, and there can hardly be a single customer anywhere who is unaware of the risks of smoking. Until the moment when the industry is finally driven underground by the force of relentless campaigning, BAT should stick to the knitting.

Feel-good, return bad

Exciting news from the Department for National Savings & Investments. The rate on its “green savings bonds” has been doubled! Well, not so exciting, really, since it is still only 1.3 per cent, fixed for three years, and taxable. The timing is somewhat unfortunate, since the Bank Rate was raised to 0.5 per cent this month, and the direction of travel for interest rates is clearly upwards.

If Capital Economics’ Inside Inflation tracker is right, the peak for inflation could be as high as 7.9 per cent, not falling to the 2 per cent target until 2023. This implies a Bank Rate of something painfully more than 2 per cent. Tying your capital up for three years at 1.3 per cent under these conditions looks like a sure-fire way to lose money. Perhaps you will be compensated with a warm glow from supporting green projects, whatever they are. The government has taken care not to define what is green, so while some obvious qualifiers will doubtless get heavily promoted by NS&I, in reality the money just goes in general government spending. As usual, those lending to the state get their just reward.