Next act in multi-billion dollar affair over crisis-ravaged energy company: Last week there was a temporary trading freeze on the controversial stock market transactions that lie ahead. But how long will this take?
Wien Energie’s case, including opaque corporate communications, enters the next round. As is well known, the government suddenly heard of financial requests for liquidity from the energy company of the city of Vienna. Two billion just in case. Even before that, Mayor Michael Ludwig had quietly and secretly released $1.4 billion through emergency power. The public utilities also shot into the three-digit million-dollar range multiple times.
Now for the next explosive news: As the “Krone” found out when asked, they responded and placed a temporary trading hold on futures trades. And that was last week! This has not been discussed until now.
Scholarship lockout was in the room
As a reminder, in order to guarantee security of supply, Wien Energie carries out stock exchange transactions. The majority of energy trading transactions are concluded months, sometimes even years in advance as part of so-called futures transactions. As is well known, the certainty of such already closed sales transactions in the future put the company in enormous trouble last Friday. Even a stock market lockout was in the room, should the price of electricity continue to rise and the federal government wouldn’t help with a multi-billion dollar injection.
Duration trade stop still open
During a background discussion on Thursday, Wien Energy boss Michael Strebl assured that he would not abandon futures transactions in the future: “Because futures transactions, unlike spot trading (where energy is offered in the short term, note ) or through bilateral agreements, the risk is lower.” It is all the more astonishing, however, that as a precautionary measure, Wien Energie has put in place a temporary trading freeze on futures transactions – which, according to a company spokesperson, is still in place: “At this point, we cannot say how long we will suspend futures transactions.” However, short-term trades on the exchange are still settled on the spot market.
Economists and E-Control criticize that Wien Energie should have pulled out of risky transactions much earlier given the market situation. Just like the other providers had done.
Tests should now bring clarity
Which leaves the most pressing question: Was the electricity market speculated on billions in taxes? Vienna says no. One thing is certain: there are exams. The Court of Auditors has also acted on its own initiative, as a problem has clearly been delayed. And the government is demanding answers about the background by mid-September. A condition for releasing billions.
Source: Krone
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
