Oil & Gas

U.S. pipeline hack is loudest warning yet

10 May 2021

The ransomware attack on Colonial Pipeline, a big U.S. fuel distribution network, is the latest reminder of cyber vulnerabilities. Companies, governments and lawmakers aren’t keeping up with the bad guys. It will take more money, a sharper focus, and coordination.

Capital Calls: Pfizer, ConocoPhillips

4 May 2021

Concise views on global finance: About $6 bln of additional earnings from Covid vaccines at the U.S. drug giant should mean more capital returned to investors; the independent oil group is offloading stock in Canada-based Cenovus it collected as part of a deal four years ago.

U.S. Big Oil can momentarily thump its chest

30 Apr 2021

Exxon and Chevron’s first quarters were helped by rising oil and chemical prices, offsetting weak refining. Free cash flow ballooned thanks to restrained investment. They are about to benefit from abysmal last-year comparisons. It’ll be a sweet spot for oil that may not return.

Total is least-bad pick for confused oil investors

29 Apr 2021

First-quarter results show the French group and rivals BP and Royal Dutch Shell rebounding from last year’s woes. Yet BP’s turn to wind and solar may be too sharp and Shell’s too relaxed. For now, Total’s balanced green ambition and fat dividend look more appealing.

Aramco’s mystery sale saga follows familiar plot

28 Apr 2021

The Saudi oil giant is in talks to sell a 1% stake to a “leading global energy company”, Crown Prince Mohammed bin Salman says. As with previous puzzles over international IPO venues, there are plenty of potential candidates. And as with those, it’s possible nothing happens.

Capital Calls: Betway, U.S. banks, Vaccine feud

26 Apr 2021

Concise views on global finance: Another online betting group goes public by merging with a special-purpose acquisition company; some financial firms are racing to capture nearly-free funding from American depositors; Europe faces a long and costly fight for AstraZeneca vaccines.

Oil service firms are digging out of big hole

23 Apr 2021

Schlumberger joined Halliburton and Baker Hughes in predicting a slow recovery for the industry. Yet fossil fuels’ dimming prospects mean the picks and shovels may be worse off. Revenue probably peaked in 2014. Carbon capture and geothermal don’t make up the growing gap.

Mozambique’s gas loss could be green energy’s gain

6 Apr 2021

Islamic State attacks near future LNG sites have shattered the African state’s dreams of gas production. Plants planned by Total and Exxon Mobil constitute 8% of current world demand. If they are never built, a mid-decade price spike may hasten a global pivot to renewable power.

Europe’s greenwash-slayer becomes Trojan Horse

30 Mar 2021

The EU has proposed classifying natural gas as sustainable. Its taxonomy, which differentiates green assets from the rest, is likely to be watered down further. Such an imperfect guide risks leading investors astray and delaying progress towards decarbonising the economy.

Exxon-Chevron deal could help kill fossil fuels

25 Mar 2021

The creation of “Chexxon” would trigger antitrust watchdogs. But the latter fear higher prices, which would only make green power sources more competitive. Regulators could require they make investments into new infrastructure, too, effectively decreasing oil’s importance.

Suez blockage comes a year too late

25 Mar 2021

The Ever Given continues to block the Egyptian canal. Barring progress, shipping firms may soon have to re-route vessels around Africa, adding seven days and extra fuel costs. A year ago, with crude prices tumbling, many did that anyway. With oil dearer, it’s a painful choice.

Exxon’s inexperienced board leaves it exposed

22 Mar 2021

The $240 billion oil giant’s shares have fallen by more than a third in five years. Even with three new members, energy experience is limited. Showing shareholders that it will be solid stewards of capital is imperative. Otherwise, rival Chevron has a takeover opening.

Aramco’s next share offer is just as hard a sell

22 Mar 2021

The $1.9 trln Saudi oil giant’s annual results showed Covid-19 scars. If Riyadh sells more shares, Aramco’s low costs and spare capacity may be appealing to non-Saudi investors that largely sat out its 2019 IPO. But many environmental, social and governance red flags remain.

Big Oil’s Nigeria win only partly hits graft fight

17 Mar 2021

A Milan court cleared Eni and Royal Dutch Shell of corruption in a $1.3 bln oilfield deal. Yet a three-year trial and big write-offs imply their victory is pyrrhic. With U.S. sanctions an ever-present threat, commodity bosses will still think twice about risking a graft charge.

Oil price supercycle could be super short

8 Mar 2021

Crude spiked above $70 a barrel, regaining pre-virus levels. It could climb even higher given OPEC is holding back supply and global policymakers are stimulating economies. But if lofty prices encourage production by those outside the cartel, they may not last that long.

Capital Calls: American Airlines, Crypto PayPal

8 Mar 2021

Concise views on global finance in the Covid-19 era: The U.S. carrier is issuing new debt and hocking some airline miles to pay back the U.S. Treasury loan that carried restrictions on pay and dividends; PayPal investors give a shrug over another dive into bitcoin-land.

Bowing to activism may become too easy

5 Mar 2021

Danone and Exxon have revamped their boards after pressure from such investors. There’s less stigma these days in co-opting cage-rattlers. But the more easily activists get their way, the less rigorously demands will be vetted by other shareholders and in the public arena.

Market jitters make energy IPOs suddenly look good

4 Mar 2021

Wintershall Dea is preparing to list. Fears over higher borrowing costs make cash-generative oil and gas companies look relatively attractive compared to the high growth stocks investors have been dumping this year. Stabilising crude prices could make for an even sweeter spot.

Capital Calls: Exxon, Greensill, Research SPAC

2 Mar 2021

Concise views on global finance in the Covid-19 era: U.S. securities regulators take on the oil giant; Investors in even lower-risk funds get nervy about the supply chain finance provider; And a supplier of picks and shovels to the online trading boom gets a blank-check listing.

Capital Calls: Bubble alert

16 Feb 2021

Concise views on global finance in the Covid-19 era: Bitcoin burst through $50,000, and global fund managers are maximum bullish on the pace of the recovery from the pandemic.