Big Oil doubles profits in blockbuster 2022

LONDON, Feb 8 (Reuters) – Massive Oil greater than doubled its income in 2022 to $219 billion, smashing earlier data in a yr of risky power costs the place Russia’s invasion of Ukraine reshaped world power markets and, in some instances, the business’s local weather ambitions.

The revenue surge gave the oil firms scope to extend spending on oil and fuel initiatives, and an opportunity for some to rethink power transition methods to fulfill new calls for for safety of provide.

The mixed $219 billion in income allowed BP (BP.L), Chevron (CVX.N), Equinor (EQNR.OL), Exxon Mobil (XOM.N), Shell (SHEL.L) and TotalEnergies (TTEF.PA) to bathe shareholders with money.

The highest Western oil firms paid out a document $110 billion in dividends and share repurchases to buyers in 2022, spurring outraged calls on governments to impose windfall taxes on the business to assist shoppers with surging power prices.

Norway’s Equinor on Wednesday reported a doubling of adjusted working revenue in 2022 to $74.9 billion on the again of a surge in European pure fuel costs and because it grew to become Europe’s largest fuel provider after Russia’s Gazprom (GAZP.MM) minimize deliveries amid the West’s assist for Ukraine.

Oil firms final yr additionally pulled out of Russia, a significant power producer, main to large writedowns, together with BP’s $24 billion exit from its 19.75% stake in Kremlin-controlled oil large Rosneft (ROSN.MM).

LOW DEBT

The sharp rise in oil and fuel costs, falling debt ranges and the abrupt drop in Russian provides to Europe additionally drove boards to extend spending on fossil gasoline manufacturing as governments prioritised safety of provide.

TotalEnergies Chief Govt Patrick Pouyanne stated after the French firm reported document income of $36.2 billion on Wednesday that the worldwide backdrop remained very beneficial for power firms, with the stress-free of COVID-19 measures in China pushing up demand for 2023.

“We would not be shocked to see oil again to $100 a barrel,” Pouyanne stated. Benchmark oil costs are at present close to $85 a barrel.

European firms which have outlined plans to scale back or gradual oil and fuel investments and construct giant renewables and low-carbon companies to chop greenhouse fuel emissions adjusted their methods.

None have been extra stark than BP Chief Govt Bernard Looney’s transfer to row again on plans to scale back the British firm’s oil and fuel output and carbon emissions by 2030.

“We’d like decrease carbon power, however we additionally want safe power, and we’d like reasonably priced power. And that is what governments and society all over the world are asking for,” Looney stated on Tuesday.

BP’s shares hit their highest in three and a half years on Wednesday, constructing on a 7.6% achieve a day earlier following the outcomes and shift in technique.

Bernstein analyst Oswald Clint known as BP “a lesson in pragmatism, prioritisation and efficiency”, score it “outperform”.

“Pragmatism takes precedence this week as a world quick power along with governments begging for extra from firms like BP causes a response. BP will lean extra into oil & fuel for the rest of this decade,” Clint stated in a be aware.

Reporting by Ron Bousso. Enhancing by Jane Merriman

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