((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto))
(Added quote from TotalEnergies CFO in paragraph 5, updated actions in paragraph 12) by Sabrina Valle
U.S. and European oil companies reported weaker first-quarter results on Friday due to a sharp drop in natural gas prices from a year earlier.
Oil and gas company results are still behind record highs in 2022, which were boosted by a surge in demand after the COVID-19 pandemic and then when prices soared after the invasion. Ukraine by Russia.
In the United States, Exxon Mobil
French oil major TotalEnergies TTEF.PA also slightly beat analysts’ forecasts, as strong refining margins partially offset a sharp decline in profits from natural gas.
“Gas prices in Europe fell by 35%, reflecting a mild winter and high storage levels,” said Jean-Pierre Sbraire, financial director of TotalEnergies.
Exxon’s profits fell 28%, Chevron’s 16% and TotalEnergies’ profits fell 22% from a year earlier, with the two major US oil companies also suffering from falling profits from gasoline and fuels.
The Henry Hub NGc1 futures price, the benchmark for U.S. gas, has traded below $1.70 per million British thermal units (mmBtu), and fell earlier this year to its lowest level in 3 1/2 years due to hot weather and glut of supply.
Global benchmark Brent crude oil prices LCOc1 remained largely flat year-on-year at $81.76 per barrel during the quarter.
TotalEnergies expects its refining business to be less profitable in the second quarter and beyond due to geopolitical tensions and OPEC production limits.
Strong profits last year led Exxon, Chevron and Occidental Petroleum OXY.N to bid for their rivals in hopes of generating more oil and gas production.
Exxon reported a profit of $8.5 billion, the second highest first-quarter profit in more than a decade, while Chevron earned $5.5 billion and TotalEnergies reported an adjusted net profit of $5.5 billion. 1 billion dollars.
Stock prices reflected falling profits: Exxon fell 2.6% and Chevron fell less than 1% in year-end trading in New York. TotalEnergies shares closed 2.09% higher in Paris after a $2 billion share buyback was reconfirmed.
Executives did not give new guidance on their production outlook for the coming quarters during their conference calls, giving investors less reason to celebrate.
The outlook for the two largest U.S. oil companies depends in part on pending approvals for two takeover bids.
Exxon aims to complete its purchase of Pioneer Natural Resources
PXD.N in the current quarter.
Chevron said its bid for Hess HES.N was progressing. The deal is expected to be put to a shareholder vote at the end of May, and arbitration proceedings with Exxon, which is blocking the sale, are expected to be concluded during the fourth quarter.