Oil investors are complacent on climate change 6 Aug 2018 Shareholders in the likes of Shell aren’t holding companies to account on carbon targets. A Breakingviews analysis suggests why: they may suffer only mild losses if oil majors just run down their reserves. But doing nothing may backfire if governments take more radical action.
BP starts to differentiate itself in a good way 31 Jul 2018 The UK oil major’s net profit beat expectations in the second quarter, in contrast to rivals like Shell and Exxon. BP is generating free cash, doing logical deals and hiking output. A 5.4 percent dividend yield reflects past Gulf of Mexico problems more than future potential.
Saudi’s Aramco plan B is too clever by half 27 Jul 2018 With the oil giant’s listing stalled, Riyadh wants to lever it up to buy a stake in chemicals group SABIC. It shouldn’t overburden Aramco, and offers a roundabout way of getting money to the state. But compared to an IPO it’s riskier, and does less to boost Saudi capital markets.
Exxon long-term view is more than short-term worry 27 Jul 2018 With declining production, the $360 bln group is missing out on current buoyant oil prices. Chevron’s second quarter likewise fell short, but along with European competitors it is boosting share buybacks. Exxon’s owners can justifiably fret about the industry’s uncertain future.
BP takes worthwhile gamble with shale deal 27 Jul 2018 The $10.5 bln that the oil major is paying for BHP’s U.S. shale assets is a full price and allows the miner to finally extricate itself from an expensive mistake. But BP is plugging a strategic gap and can easily cut costs. That makes the price appear more reasonable.
Conoco escapes squeeze on Big Oil’s golden goose 26 Jul 2018 Infrastructure bottlenecks are depressing oil prices in America’s resource-rich Permian Basin. New pipelines should be running by next year if labor and steel problems don’t cause delays. While the $84 bln Conoco’s U.S. business is holding up, others may not be so fortunate.
Shell and Total can hand investors even more cash 26 Jul 2018 The Anglo-Dutch major has begun a $25 bln share buyback, months after its French peer. That may signal Shell lacks growth ideas, yet investing in new oil projects and green energy is also risky. Sharing windfalls from high oil prices with shareholders is the lesser of the evils.
Trump hardball may still become Iran oil softball 23 Jul 2018 The president’s Twitter attack on Tehran counterpart Hassan Rouhani doesn’t sound great for importers of Iranian crude. Yet U.S. sanctions policy is volatile - just ask Russia’s Rusal. Another Trump goal - low petrol prices - implies Iranian exports will still be tolerated.
Aramco’s downstream diversion solves few problems 19 Jul 2018 Buying a stake in petrochemical maker SABIC would enable the Saudi oil giant to diversify its business. But it complicates the government’s plans to open state companies to private capital. And the holding is too small to pump up Aramco’s valuation in an initial public offering.
Exxon lobby exit boosts investor climate activism 13 Jul 2018 The $350 bln oil giant has quit a group trying to ease regulation of greenhouse gases. That’ll make it harder to fend off shareholders pushing Exxon to tackle how climate change will hit earnings. California cutting its emissions ahead of schedule shows that’s a growing risk.
Delta’s refinery is short of fuel-price alpha 12 Jul 2018 The $35 bln U.S. airline’s growing top line has so far outpaced the rising cost of oil. But the company warned fuel will squeeze its profit for the full year. The 2012 purchase of a refinery has only modestly mitigated the problem. To justify owning it, Delta needs more juice.
Aramco fail hits Saudi ambition more than coffers 10 Jul 2018 If the state oil firm's IPO doesn't fly, Crown Prince Mohammed bin Salman will be $100 bln short. That's huge, but higher crude prices will help the budget and Riyadh can borrow too. The bigger problem is finding other ways to lure the foreign capital his 2030 vision depends on.
BHP Permian sale hits reset on regional boom 9 Jul 2018 The mining giant is looking to offload shale assets in the West Texas area. A mooted price of around $10 billion suggests valuations are starting to drop. The Permian’s global clout remains, but until producers can fix pipeline bottlenecks, a more measured approach makes sense.
India’s Cairn Energy fire sale is short-sighted 9 Jul 2018 Tax authorities have sold part of a stake in Vedanta Limited seized from the UK company in a $1.3 bln tax dispute, weeks before the pair go to arbitration. India only pockets $216 mln, half what the shares were worth at the start of the year. The timing and the logic look flawed.
Aramco IPO retreat would leave few losers 6 Jul 2018 Pinning a $2 trln valuation on a company worth $1.6 trln was always going to be risky for the Saudi oil giant’s bankers. If Aramco’s IPO is scrapped, they may get another bite at a more modest cherry. It would, though, sting regulators who bent over backwards to accommodate it.
High oil prices are as American as apple pie 4 Jul 2018 President Trump’s sniping at OPEC seems to be led by concerns about spiraling petrol pump prices. But these aren’t high enough to stop drivers from hitting the road. And while the U.S. remains a net oil importer, surging domestic production will also help the economy.
Viewsroom: Trump goes hog wild on trade 28 Jun 2018 The U.S. president rejected hard-liners’ calls to ban China investing in sensitive U.S. tech. Yet he’s pushing for tariffs that could cost carmakers $45 bln and is livid Harley-Davidson will no longer make EU-bound bikes in the States. Plus: tapping China’s shale reserves.
BP’s electric car foray is imperfect oil hedge 28 Jun 2018 The British giant is spending 1 pct of its $16 bln capex budget on battery-powered vehicle chargers. That’s unlikely to protect against a drop in crude demand. But after writing down most of its last $8 bln push into new energies, investors doubt BP can reinvent itself.
China’s homegrown shale is worth the bother 27 Jun 2018 The People’s Republic produced a fraction of U.S. shale gas output in 2017. Terrain issues, deep wells and limited data explain why, yet better domestic technology and state support are pushing production up. With trade tensions rising, Beijing's costly hedge looks sensible.
Big Oil win over U.S. cities will be short lived 26 Jun 2018 A judge dismissed a long-shot lawsuit by Californian metropolises trying to hold Exxon and others liable for climate change. But many cities are slashing their CO2 emissions, which account for some 70 pct of the global total. Those attempts can pipe fossil fuels into obscurity.