Big Oil’s profit bonanza raises flaring risk 2 Nov 2018 Exxon and Chevron posted sharp earnings gains and the strongest cash flows since days of $100 crude. Texas drilling is rising and areas like Guyana are booming. But price rises may not last and investors are demanding greater returns. It’s not a time for spendthrifts.
Shell deserves to check out of investors’ doghouse 1 Nov 2018 The UK energy group slightly undershot earnings forecasts but generated oodles of cash in the third quarter. That compensates for a bigger disappointment earlier this year. Unless oil prices dive, Shell should be able to invest as much as it needs while rewarding shareholders.
BHP atones for past M&A sins 1 Nov 2018 The mining titan is returning all $10.4 bln from its U.S. shale sale in a dividend and buyback. A nudge from pushy investor Elliott and deal discipline led to a better use of capital than in the last cycle. Boss Andrew Mackenzie has set a higher bar for BHP’s financial balance.
China’s oil windfall covers up hints of gas pain 31 Oct 2018 PetroChina has reported a more than fourfold rise in quarterly earnings, a bumper profit fuelled by higher crude prices. But the $210 bln state producer also took a heavy hit on gas imports this year. Those losses may widen as China cranks up a shift away from coal at all costs.
BP mends balance sheet roof while the sun shines 30 Oct 2018 The UK energy group is now financing its $10.5 billion BHP shale deal entirely from cash, instead of partly using equity. A gush of free cash flow justifies that show of strength. CEO Bob Dudley is, however, right to avoid other splurges given lofty oil prices may not persist.
Saudi reforms crash into royal reputational risk 26 Oct 2018 In October 2017, Saudi Arabia’s Crown Prince Mohammed bin Salman outlined a more liberal and market-friendly vision in Riyadh. A year on, the kingdom is under fire after the death of Saudi journalist Jamal Khashoggi. Breakingviews explains what happened in between.
E-book: A year in the life of MbS 26 Oct 2018 In October 2017, Saudi Arabia’s Crown Prince Mohammed bin Salman outlined a more liberal and market-friendly vision in Riyadh. A year on, the kingdom is under fire after the death of Saudi journalist Jamal Khashoggi. Breakingviews explains what happened in between.
Khashoggi showcases moral trilemma of big business 26 Oct 2018 Total sent its CEO to Riyadh for Saudi’s flagship conference despite its role in a Saudi journalist’s death. HSBC fielded a big team, too. Firms strive to be larger, profitable and ethical, but often only achieve the first two. Profit’s lead over ethics appears to be narrowing.
Climate suit should light fire under Exxon owners 24 Oct 2018 New York is suing the $338 bln oil giant, claiming it misled investors about carbon’s environmental risks. Shareholders weren’t dupes, though. Their proxy revolt last year forced the outfit to start addressing the issue. Legal heat should prod them to demand more than baby steps.
Saudi oil could help grease Turkish discretion 24 Oct 2018 Leaked details of a Saudi journalist’s death have dominated Turkish media but President Erdogan hasn’t yet directly implicated the kindgom’s crown prince. Ankara may be hoping to use its leverage to help its economy. The lira has recovered, but cheap oil would still help.
Viewsroom: Saudi fiasco sets Wall Street ablaze 18 Oct 2018 Bankers and officials have ditched a huge Saudi shindig after Turkey accused the kingdom of killing a prominent journalist – but big deal fees and oil reserves make the kingdom hard to shun. Breakingviews columnists discuss the financial ramifications of the diplomatic crisis.
Energy bigwigs fiddle while world burns 16 Oct 2018 The White House may nix a plan to breathe life into the coal industry. Exxon’s new support for a carbon tax could mostly hit anthracite, not its own fossil fuels. Avoiding devastating climate change requires serious commitment, not baby steps, putting yet more onus on investors.
Oil makes Saudi Arabia slippery sanctions target 16 Oct 2018 U.S. lawmakers are invoking a law used to impose Russian sanctions to demand answers about a missing journalist. There’s momentum for a similar penalty for the kingdom. But Saudi retaliation could hike oil prices - the opposite of what President Trump has been agitating for.
IPO procrastinators face a long wait on the shelf 15 Oct 2018 Oil group Cepsa, LeasePlan and Tencent Music have delayed floats due to the stock market selloff. That reasoning is dicey when others have listed without much of a hitch. Tricky IPOs need buoyant investors. With rates rising and Brexit looming, they may have missed the window.
Saudi adviser panel may unwind faster than Trump’s 11 Oct 2018 A forum of foreign executives has seen departures amid rising political tensions, as a U.S. White House CEO council did last year. Cozying up to princes and presidents confers an air of virtue and status. When it looks like advice isn’t being heeded, it goes quickly into reverse.
Anti-OPEC bill may squeeze U.S. oil industry 10 Oct 2018 The disappearance of a Saudi journalist is helping to breathe life into a bipartisan effort to subject the cartel to U.S. antitrust law. But it may prove more useful as a threat than reality. America’s energy producers benefit from OPEC’s price-fixing, too.
China’s oil appetite won’t be enough to save Iran 8 Oct 2018 Beijing has resisted U.S. calls to cut crude imports once sanctions hit. But hopes that will be enough to offset a drop of as much as 1.6 mln barrels a day in Iranian exports look optimistic. Instead, it seems to be eyeing the old playbook of public bluster and quiet reductions.
Russia and Saudi’s oil stitch-up will unravel 4 Oct 2018 Moscow and Riyadh’s deal to boost crude output is the best chance of cooling red-hot prices. Yet the duo’s power is more limited than it appears. U.S. sanctions on Iran will dent the Islamic Republic’s supply faster than they can pump. Prices could still spike in the short term.
Cepsa prices itself to avoid IPO oily patches 2 Oct 2018 The Spanish oil group is going public at a valuation of 7-8 billion euros, the lower end of expectations. That will allow owner Mubadala to sell the required 25 percent at a premium to rival Repsol. Anything richer would have been risky among the current rush of listings.
BHP can hide behind Unilever dual-listing mutiny 2 Oct 2018 Some big shareholders oppose the Dove soap maker’s plan to switch to one, Dutch, headquarters. Pushy investor Elliott has been calling for a similar corporate overhaul at the world’s largest miner. There are differences, but the campaign for simplicity just got more complicated.