Fossil Fuels

Oil will aid rather than hinder Trump-MbS bromance

16 Dec 2024

Both the US president-elect and the Saudi crown prince want to pump more crude in 2025. Yet US drillers aren’t certain to do so. And Mohammed bin Salman may be able to extract a quid pro quo in return for deploying spare oil capacity should Donald Trump crack down on Iran.

India tightens its crude bear hug of Russia

12 Dec 2024

Reliance is set to buy Rosneft oil worth $13 bln a year for a decade in the biggest energy deal between the countries. It helps New Delhi cut its current account gap and buy goodwill ahead of Vladimir Putin’s visit. But Moscow’s struggle to manage a flood of rupees may intensify.

Shell and Equinor make the best of UK oil decline

5 Dec 2024

The oil majors are combining their North Sea assets in a joint venture. Splicing the two together makes sense as it will allow them to share Equinor’s 6 bln pound tax losses and protect against rising windfall taxes. It could also pave the way for an easier future exit.

Oil’s geopolitical risk premium is still there

27 Nov 2024

Israel and Iran-backed Hezbollah have struck a peace deal brokered by the US and France. In theory, a calmer Middle East plus weaker demand forecasts should prompt a tangible slide in the price of crude. But a tougher US policy on Iran merits an ongoing risk premium.

COP29 steals defeat from jaws of abject failure

25 Nov 2024

The $300 bln-a-year financing target for poorer states adopted at the UN climate shindig is woefully inadequate. It also assumes the West will provide part of the cash from sources it's leery of, like carbon taxes. The saving grace is that diplomacy lives to fight another day.

Adani’s US woes put TotalEnergies on the spot

22 Nov 2024

The $137 bln French group has 20% of Adani Green Energy. Gautam Adani’s US bribery charges present a different challenge to those faced by TotalEnergies in Iran in 2018. But they complicate CEO Patrick Pouyanné’s plans to expand in a key growth market.

Russian gas to Europe is on the slow road to zero

22 Nov 2024

The slim possibility of a Trump-brokered end to Moscow’s war with Ukraine raises the question of whether the European Union would ever buy more of its fossil fuels. Yet EU reliance on Russian pipeline gas is set to fall further. Moreover, Europe doesn’t need it.

Siemens Energy’s vicious circle becomes virtuous

13 Nov 2024

The $35 bln German group surged 20% after it revealed punchy 2028 targets. For years, troubles in its wind unit obscured Siemens Energy’s status as a green transition winner. While these aren’t all fixed, the company looks cheap if CEO Christian Bruch can hit his new goals.

Shell’s legal win flags need for new green metrics

12 Nov 2024

A Dutch court has nixed a 2021 ruling forcing the $204 bln oil major to cut emissions by 45% by 2030. Such metrics had already been undermined by Big Oil asset sales, which don’t stop climate change. Drillers’ spending on low-carbon energy is a better gauge of green credentials.

Saudi megafund’s success rests on fuzzy local bets

5 Nov 2024

The kingdom’s $950 bln Public Investment Fund is best known for outlandish construction schemes and flashy foreign forays. But its biggest and fastest-growing division houses young domestic firms. While some may thrive, it’s less clear they can guarantee the vital pivot from oil.

Saudi’s Davos is no longer such a desert

1 Nov 2024

Around 8,000 CEOs and financiers flocked to the Future Investment Initiative in Riyadh, twice the number at its inception in 2017. Western bosses were keener to talk about artificial intelligence than investing in the kingdom. But Saudi’s progress suggests that may yet change.

BP may have to become even less investor friendly

29 Oct 2024

The $83 bln UK major is facing a strained balance sheet, low oil prices and trouble in its renewables unit. CEO Murray Auchincloss’s plan to return cash will hinge on tricky asset sales. Cutting buybacks would be better but would make the stock even less appealing than its peers.

Many roadblocks delay journey to zero carbon world

28 Oct 2024

While solar power and battery supply have grown massively, the same is not true of electricity grids, green hydrogen and carbon removal. Money is more expensive. This means demand for oil, gas and coal has not yet peaked. The setback will cost the planet dearly.

Middle East turmoil edges closer to global economy

3 Oct 2024

Military escalation between Iran and Israel may at some point affect the price of oil. In this Viewsroom podcast, Breakingviews columnists debate how the conflict may prompt a fresh inflationary headache for central banks – and how Saudi Arabia might offset that risk.

Saudi oil may keep a lid on Middle East fallout

30 Sep 2024

Israel’s killing of Hezbollah’s leader invites a response from its backer Iran, which could cause crude prices to spike. Yet Riyadh may also soon start pumping a lot more oil. That could prolong the extent to which the economic impact of seismic Middle East events stays regional.

Europe’s CO2 fines undermine carmakers’ progress

19 Sep 2024

An auto lobby group called on governments to ease 2025 carbon penalties. Modest relief would help. With EU electric-vehicle sales down 8% year-on-year, Europe’s plan to end combustion engines looks dicey. That’s more down to government inaction than big-spending carmakers.

Oil’s new slump cuts across OPEC’s plan A

4 Sep 2024

Crude prices are off sharply, partly due to weak economic data and partly because a potential Libyan supply crisis appears to have been resolved. Yet OPEC plans to hike output in October. The producer group may have to choose between aggravating the selloff and its own unity.

Saudi fund’s prudence pivot is only half complete

20 Aug 2024

The $925 bln Public Investment Fund is spending more money locally. That should do more to help Saudi’s diversification push than past international forays. But the domestic projects are often speculative, implying low returns and a continued shortage of foreign co-investors.

Iran danger marks return of oil’s risk premium

13 Aug 2024

Conflict in Gaza and tit-for-tat attacks in the Middle East have desensitised markets to possible supply shocks. A US warning of imminent retaliation against Israel changes that. Despite weaker demand, oil prices reflect the dangers of infrastructure and tankers becoming targets.

Glencore may be the next UK listing to head west

7 Aug 2024

The $61 bln miner had planned to spin off its coal unit via a New York IPO. Given the pollutant’s profit remains alluring, it now won’t. But Glencore boss Gary Nagle could weigh up US investors’ greater fondness for fossil fuels, and opt to move the whole company instead.