Qatar can weather latest foreign stress test 27 Oct 2023 The Gulf emirate is under scrutiny for its links to Hamas, six years after a blockade by neighbours. One risk is that its $450 bln sovereign wealth fund gets a frostier reception. But Doha’s giant gas reserves and its role as mediator and US ally should protect its clout.
Real big energy: Exxon and Chevron swim upstream 26 Oct 2023 The two US oil titans unveiled acquisitions worth more than $100 bln combined within weeks of each other. In this Viewsroom podcast, Breakingviews columnists discuss what’s powering the renewed consolidation push, as well as the threats posed to the industry by a greener market.
Europe’s oil majors are stuck as M&A party-poopers 26 Oct 2023 Exxon Mobil and Chevron’s respective decisions to double down on oil have put European peers Shell, BP and Total on the spot. Yet their lower valuations complicate share deals. The most obvious big targets for lower-carbon M&A are invitingly cheap, but look hard to get at.
Hess deal would be higher-octane with cash added 25 Oct 2023 The takeover target’s rich valuation grants it a chunky stake in an enlarged Chevron. But the $53 bln merger now offers no premium and only shares in an underperforming acquiror. Chevron CEO Mike Wirth may have to bid against himself by throwing in a sweetener with hard currency.
Chevron’s $53 billion deal is risky Exxon copycat 23 Oct 2023 The all-stock offer for Hess is more speculative than rival Exxon’s massive plunge in Texas shale. It also makes Chevron look more like its US rival: Exxon already owns a piece of prolific Guyana fields with Hess. The long-term bet could work, but for CEO Mike Wirth, it’s dicey.
China’s Middle East agenda gets harder to manage 23 Oct 2023 The country’s private refineries have been snapping up over 90% of Iran’s cheap crude exports. Tighter US sanctions in the face of the Islamic Republic’s support for Hamas could turn these customers away. That would cut across Chinese efforts to grow influence in the region.
Israel’s fossil fuel boon becomes less clear-cut 19 Oct 2023 The country’s rapidly rising gas exports were billed as a way to replace 10% of the Russian supplies lost by Europe. UAE oil giant ADNOC has also bid to buy local fossil fuel assets amid improving relations with the Gulf state. Israel’s war with Hamas complicates both objectives.
Saudi is wild card in Middle East’s new turmoil 18 Oct 2023 War in Israel complicates Crown Prince Mohammed bin Salman’s modernisation push. He must consider the oil market, rivalry with Iran, overseas investment, and the views of 32 mln citizens. How the Gulf’s biggest economy proceeds has big implications for the region – and the world.
Exxon’s last mega-deal casts shadow on latest one 11 Oct 2023 The $60 bln acquisition of Pioneer will be the energy giant’s biggest since it bought XTO for $31 bln. It overpaid for expertise and acreage in 2009 near a peak in gas prices. Fracking experience gives boss Darren Woods an edge now. The timing may be equally bad, however.
US linkup with Saudi could cause OPEC shift 10 Oct 2023 Spiraling conflict in the Mideast could spur tougher US sanctions on Iran. That might lead to a US-Saudi rapprochement. Power, then, moves away from the rest of OPEC. Saudi is in a tough spot, but the US could grow even mightier in the fossil fuel market.
Exxon $60 bln deal would mark shale’s middle age 6 Oct 2023 Buying Pioneer, a huge producer of oil in the US Permian, would be a mega-acquisition even for Exxon, but a rational one. It could offer a reasonable return, and the ability to exploit future oil-price spikes. For a maturing Pioneer, now isn’t a bad time to settle down.
China is swing factor in diesel’s global squeeze 5 Oct 2023 Russia’s export ban on the fuel may prove a temporary scare. But low inventories in the US and Europe, spiking crude prices and a colder winter could keep it in short supply. The key variable, though, is whether China helps ease the pressure by raising export quotas.
Oil spike offers only a brief boon for Fed and MbS 21 Sep 2023 Crude prices are up 25% since July, swelling the Saudi crown prince’s budget. Fed boss Jay Powell wins too: he can use it to justify inflation-busting high rates. Yet long-term, a surfeit of energy demand over supply will complicate life for both central bankers and oil tsars.
Big oil lawsuits are riskier than quitting tobacco 18 Sep 2023 California is suing fossil-fuel companies, alleging tens of billions in climate-related damages. Decades of litigation forced tobacco firms to pay up. The tension is that, while global warming’s ravages imply higher costs, US oil production is crucial amid tightening supply.
BP CEO exit raises strategy and board questions 14 Sep 2023 Bernard Looney resigned after he failed to disclose past relationships with staff. In this Viewsroom podcast, Breakingviews columnists debate what that means for the oil giant’s commitment to net zero, and whether BP’s board did all it could have done.
BP succession fail puts spotlight on its board 14 Sep 2023 Chair Helge Lund and his colleagues could have lined up a replacement for now-departed boss Bernard Looney when issues over his conduct surfaced last year. They didn’t. Before rushing to appoint a new CEO at the $110 bln oil group, they should interrogate their own performance.
BP CEO’s exit brings strategic impasse to a head 13 Sep 2023 Bernard Looney quit as the $112 bln oil group’s boss over past relationships with colleagues. BP shares lagged rivals during his tenure due to an ill-timed pivot to green energy. His replacement will have to decide whether to stick with the strategy, or pivot back to oil and gas.
Time to target fossil fuel demand, not supply 11 Sep 2023 Climate activists want countries and companies to stop producing oil, gas and coal. It would be more effective to focus on cutting demand for fossil fuels – by campaigning for carbon taxes, green subsidies and faster licences for renewable energy, says Hugo Dixon.
Double defensive gas deal offers relative cleaning 6 Sep 2023 Canadian pipeline firm Enbridge wants to reduce dependence on transporting oil. Dominion Energy wants to concentrate on clean electricity. Selling retail gas distribution businesses for $9.4 bln to Enbridge doesn’t directly reduce emissions. But it does make both look cleaner.
African coups will exacerbate grab for resources 30 Aug 2023 Military revolts in Niger and Gabon are destabilising two resource-rich nations. That’s bad news while the continent struggles with rising interest rates, no market funding and poor governance. Uncertainty will intensify global powers’ rivalry for control of oil and minerals.