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BP, Shell Help Lift Oil-Trading Profitability to 6-Year High



By Javier Blas and Andy Hoffman: October 26, 2016

The trading arms of Royal Dutch Shell Plc and BP Plc enjoyed their best year ever in 2015, helping push the combined gross margins of oil merchants to a six-year high, according to a closely watched report.

Oil traders last year “stormed ahead, thanks to low, volatile spot prices that created cash-and-carry opportunities,” consultancy Oliver Wyman said in its annual review of the commodities-trading industry published Wednesday.

These gross margins — a rough measure of profitability — rose to a combined $19 billion, the highest since 2009, when oil traders benefited from big price swings and oversupplied markets. For commodities traders in general, total gross margins stagnated at $44 billion for the second consecutive year as natural gas, power and other markets underperformed oil.

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Fitch: Batteries could be key disruptor to oil industry in “investor death spiral”


Oct 18 2016, 12:45 ET | By: Carl Surran, SA News Editor

Oil producers such as ExxonMobil (NYSE:XOM), Chevron (NYSE:CVX) and Royal Dutch Shell (RDS.A, RDS.B) must prepare for radical change as adoption of new technologies like electric cars could happen faster than originally anticipated, according to a new report from Fitch Ratings.

“Widespread adoption of battery-powered vehicles is a serious threat to the oil industry,” and an acceleration of the electrification of transport infrastructure could create an “investor death spiral” as investors flee the oil patch, Fitch warns.

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How electric cars could smash BP plc and Royal Dutch Shell plc



By Harvey Jones – Tuesday, 18 October, 2016

Investors in UK-listed oil giants (LSE: BP) and Royal Dutch Shell (LSE: RDSB) have been paying close attention to the oil price because they know that unless it climbs higher, their juicy 7%-plus dividend yields will be in jeopardy. However, they need to look to more distant horizons, because even if the oil price does climb a little higher this year, the long-term outlook is mixed.

Golden years

I’ve always thought ‘black gold’ to be a rather daft a description for oil, given that gold has few practical uses but the global economy runs on crude. However, that may not always be the case, due to the rise of electric vehicles and renewable energy. A new report from the World Energy Council suggests these two trends could hit demand for oil sooner and harder than expected. Oil consumption could actually start falling within the next 10 to 15 years and if correct, this would play havoc with the investment case for BP and Shell.

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Shell, BP Hold Lure of Higher Payouts After Brexit Hurts Pound

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screen-shot-2016-10-06-at-13-11-55By Rakteem Katakey: October 12, 2016

The British pound’s slump to a 30-year low is handing a windfall to U.K.-based shareholders of Royal Dutch Shell Plc and BP Plc.

The currency’s decline means the two oil companies are making higher payouts to U.K. investors when they distribute their dollar dividends in pounds. Shell and BP have pledged to prioritize defending their dividends through oil’s biggest downturn in a generation.

The companies have maintained their payouts for the past two years and shareholders who have stayed invested through crude’s slump are likely to get additional cash in the U.K. currency as the pound remains weak following Britain’s June 23 decision to exit the European Union. The potential for higher cash payouts is driving up the companies’ London-listed shares. U.S. investors get no benefit from the currency’s more than 17 percent slide against the dollar in the period, which makes the pound the worst performer among major currencies.

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Oil: OPEC Finally Agrees And Investor Takeaways


Dividend Income: 5 October 2016


  • OPEC has agreed to put a ceiling on oil production at 32.5 million barrels per day, representing a 900k cut from its current output at 33.4 million.
  • The news supported oil’s rise by nearly 10 percent, and benefits some companies significantly more than others.
  • The author still recommends to stay away from offshore, but upstream producers with lower break even cost could be an attractive investment. Integrated majors’ dividends are also safer than ever.

News Summary

To the surprise of everyone, the Organization of Petroleum Exporting Nations (OPEC) has agreed to put a ceiling on oil production at 32.5 million barrels per day, which is significantly less than its current 33.4 million barrels per day of production. The news has helped oil price rally nearly 10% to almost $51.50 per barrel Brent.

In this article, I will try to dissect the news and its effect on integrated majors, upstream producers and offshore producers. Of course, the news benefit some of these companies significantly more than others, which are actually unaffected or evenly negatively affected by the news. Similarly, I will analyze how it will affect the United State Oil ETF (NYSEARCA:USO) and other oil related ETFs going forward.

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Shell, Chevron Drop Off Platts Top 10 Energy Firm List



screen-shot-2016-09-20-at-21-16-05By Irina Slav – Oct 03, 2016, 10:26 AM CDT

Shell and Chevron were among the international oil giants that fell off the top 10 companies of 2016 in the S&P Platts’ annual ranking of the 250 biggest companies by assets and revenues. The asset value and revenue figures are all for 201—the year when the oil price collapse really began to be felt.

The USA Today quotes Platts as saying the changes in the top 10 segment reflected the continuing depression on international oil markets. The price slump, Platts said, hit oil and gas majors’ earnings hard, and it also led to a serious devaluation of assets, meanwhile benefiting companies with stronger downstream operations, pure-play refiners, and power utilities.

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Opec’s unclear resolve

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Opec’s unclear resolve

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By Ed Crooks, September 30, 2016

After two years of inaction as a strategy, Opec this week decided to do… something. Exactly what it will end up doing has yet to be determined.

When Opec ministers met at a beach resort in Algiers, they agreed a statement setting a target for their oil production that is roughly 250,000-750,000 barrels per day lower than the cartel’s current output. The big missing piece from the deal, though, was how the cartel’s members would share out the cuts needed to reach that target. A “high-level committee” of representatives from member states, supported by the Opec secretariat, will work on recommendations for individual countries’ cuts, which could be confirmed at the next ministerial meeting, in Vienna on November 30.

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Is OPEC’s Output Deal A Game Changer For Royal Dutch Shell And BP?

Is OPEC’s Output Deal A Game Changer For Royal Dutch Shell And BP?

Royston Wild: Sept 29, 2016

Investors in the fossil fuel sector have finally had cause to celebrate this week after OPEC suggested that an output freeze could finally be in the offing.

The idea had initially been tabled at the start of the year as Saudi Arabia, Qatar, Venezuela and Russia got around the table. But Iran’s determination to get the pumps ramped back up to pre-sanction levels put the plan firmly on the backburner.

However, with Tehran’s reluctance to take part in a deal now apparently thawing, stock pickers have become more optimistic over the growth outlook for many of the oil industry’s major players.

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Shell and BP shareholders can use votes to make firms go green, campaign group says


Screen Shot 2016-08-04 at 14.47.05Shell and BP shareholders can use votes to make firms go green, campaign group says

Written by Mark Lammey – 29/09/2016 7:42 am

A campaign group is urging Shell and BP shareholders to use binding votes on pay plans to encourage bosses to embrace green energy, a news report said yesterday.

ShareAction said sticking with old remuneration policies that reward executives for digging for oil would lead to both companies becoming obsolete and going bankrupt, The Guardian reported.

In line with rules introduced in 2013, large companies like Shell and BP face binding shareholder votes on three-year pay policies next year, the report said.

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Shares in oil giants BP and Shell surge on production cut deal

Shares in oil giants BP and Shell surge on production cut deal

The agreement by OPEC countries boosts hopes for a sector which has seen mass job cuts, but could push up prices at the pump.

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Thursday 29 September 2016

Shares in Royal Dutch Shell and BP have surged after top oil producing countries agreed to cut production for the first time in eight years.

Shell climbed 6% and BP was up 4% following the decision by OPEC – with other commodity firms also performing strongly.

The stocks helped the FTSE 100 Index turn 1% higher, with improvements also seen in French and German markets, following an upturn for Asian shares overnight.

OPEC’s agreement on Wednesday helped the price of a barrel of Brent crude climb above $49 overnight, before slipping back slightly.

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BP and Shell investors urged to reward bosses for backing green energy

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Screen Shot 2016-08-04 at 14.47.05BP and Shell investors urged to reward bosses for backing green energy

Shareholders should use binding votes on pay policies next year to push executives to stick to climate goals, says ShareAction

Sean FarrellThursday 29 September 2016 00.01 BST

Shell and BP’s pay plans encourage their bosses to dig for oil instead of investing in low-carbon energy and should be overhauled by shareholders, according to the campaign group ShareAction.

Investors in the oil companies should use binding votes on pay policies next year to scrap short-term targets and reward chief executives for working towards the target set in Paris last December to limit global temperature increases to 2C or less, the responsible investment group says in a report.

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Shell’s 70-year dividend record at risk


By Lee Wild | Thu, 22nd September 2016

Running an income fund has been fairly straightforward for the past few years. Drug giants like GlaxoSmithKline (GSK) and AstraZeneca (AZN) have kept up shareholder returns and the telecoms sector has offered rich pickings. So have BP (BP.) and Royal Dutch Shell (RDSB). However, income plays are becoming more expensive, and now we’re hearing that Shell’s dividend record is in serious danger.

Shell has not cut the dividend since the Second World War; it’s a fact we love to repeat whenever the conversation turns to the oil sector and dividends. And, despite a 55% rally since late January, the shares still offers a prospective dividend yield of 7.3%.

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Shell and BP have lost billions – now the low price of crude is hurting other firms too



Oil is slowly climbing back to $50 a barrel as a deal between Saudi Arabia and Russia and an agreement on production in Venezuela helped to stabilise prices.

The production agreements could finally give some assurances to dozens of companies who have suffered since crude slumped from $114 a barrel in 2014 to $28 early this year.

Oil supermajors such as BP and Shell have been high-profile casualties, losing billions in profits.

They’ve written off billions of pounds and have had to slash tens of thousands of jobs as they change their businesses to cope with the reduced profits.

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FTSE 100 edges higher but BP and Shell slip on oil glut fears


Nick FletcherTuesday 13 September 2016 11.18 BST

Oil shares are among the biggest fallers after crude prices slid further in the wake of a downbeat report from the International Energy Agency. The agency said the oil market would be oversupplied until at least the first six months of 2017, given a sharp slowdown in demand and rising stocks. A month ago it predicted suppy and demand would be broadly in balance for the rest of the year, and inventories would fall sharply.

Chris Beauchamp, chief market analyst at IG, said:

The IEA has joined OPEC in pouring more cold water on the oil price this morning. After OPEC flipped its prediction of dwindling non-OPEC supply in 2017, instead warning that it was set to rise due to a major new oilfield in Kazakhstan coming online, the IEA has issued a stark warning that the pickup in demand seen in the first half of the year has completely evaporated. It has cut its demand forecasts for the second half and the whole of 2017 and is now predicting the glut will remain in the global market for the whole of next year. Oil prices are down this morning, although the real capitulation could come towards the end of the month if OPEC and Russia fail to agree a supply freeze

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Shell begins production at world’s deepest underwater oilfield


Simon BowersSunday 11 September 2016 17.15 BST

Royal Dutch Shell has started production at the world’s deepest underwater oil and gas field, 1.8 miles beneath the sea surface in the Gulf of Mexico.

The latest costly addition to Shell’s production capacity comes despite Van Beurden’s repeated pledges on climate change. In May, he said: “We know our long-term success … depends on our ability to anticipate the types of energy that people will need in the future in a way that is both commercially competitive and environmentally sound.”

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Why I’m expecting Royal Dutch Shell plc and BP plc to plummet!

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By Royston WildThe Motley Fool: Friday, 2 September, 2016

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Investor appetite for the oil segment has taken a knock in recent weeks as fears of a prolonged supply glut have weighed.

British majors Royal Dutch Shell(LSE: RDSB) and BP(LSE: BP) have seen their share prices slip 10% and 7% respectively during the past six weeks, for example. And I believe a sharper retracement could be just around the corner.

Stocks keep surging

Broker predictions that the oil market is set to balance later this year are being put under increased scrutiny as already-plentiful stockpiles continue to build.

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Speculation rises over Opec output freeze

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By Ed Crooks: September 2, 2016

Over the past month, the big stories in the oil market have been speculation about a possible production freeze from Opec, and the reality of rising activity in the US shale industry.

The rumours of Opec action have followed the pattern that has become wearingly familiar over the past couple of years, since the landmark meeting in November 2014 confirming that Saudi Arabia was not prepared to cut production to try to stabilise prices.

As the meeting – in this case, a gathering on the sidelines of the International Energy Forum in Algiers on September 26-28 – grows nearer, suggestions that a freeze will be discussed grow louder. Venezuela, which has the most urgent need for a higher oil price, sounds the most enthusiastic about curbing production. Other countries make supportive statements and agree to meet, without promising any action themselves.

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Slashing Dividends: The Only Option Left For Big Oil?

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By Nick Cunningham – Aug 31, 2016, 4:03 PM CDT

The oil majors will have an extraordinarily difficult time trying to maintain their hefty dividends in today’s oil market environment, and unless oil prices rebound substantially, companies may be forced to slash their payouts to shareholders.

The largest oil producers pay shareholders a combined $40 billion in dividends each year, a level that is not sustainable with oil prices at $50 per barrel, according to Chris Kettenmann of Macro Risk Advisors. “There’s massive risk to the dividend structure of these big oil companies over the next 12 months,” Kettenmann said on Bloomberg TV.

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Shell Looking Beyond Petroleum

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There are many players looking to enter the oil markets thanks to the raft of deals available as the oil price crash appears to be over. For the oil majors, this will likely mean major opportunities to snap up unconventional producers and assets at low valuations. One “oil” major that may not be participating is Shell. The Anglo-Dutch oil giant is increasingly turning away from its roots in oil and moving towards natural gas as an alternative.

In the year 2000, 37 percent of Shell’s production was from natural gas. By 2015, that number had risen to 49 percent. For ExxonMobil, those figures were 40 percent in 2000 and 43 percent in 2015. For Chevron and BP, the 2000 figures were 27 percent and 40 percent respectively, and for 2015, it was 33 percent and 38 percent. Among oil majors, only ConocoPhillips has seen a comparable shift to gas going form 33 percent to 43 percent gas production between 2000 and 2015.

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Shell Sells Gulf Of Mexico Asset, But Faces A Tough Road Ahead

Screen Shot 2016-08-31 at 23.13.17Sarfaraz A. Khan: Aug. 31, 2016 3:20 PM ET


  • Royal Dutch Shell has agreed to sell its Brutus/Glider assets in the U.S. GoM to EnVen Energy for $425 million in cash.
  • The asset sale is a small step in the right direction which will improve Shell’s cash reserves.
  • The company, however, has made little progress toward achieving its target of selling $6Bn to $8Bn assets this year and $30Bn by 2018.

Royal Dutch Shell (RDS.A, RDS.B) has recently agreed to sell its Brutus/Glider assets in the U.S. Gulf of Mexico to Houston-based EnVen Energy for $425 million in cash. Shell was pumping 25,000 barrels of oil per day from these offshore properties, which was equivalent to 5.8% of the oil giant’s Gulf of Mexico production or less than 1% of its total production.

The asset sale is a small step in the right direction which will improve Shell’s cash reserves which stood at $15.2 billion at the end of June. Shell intends to sell $6 billion to $8 billion of assets this year. Overall, the company aims to dispose $30 billion of assets, spread in 5 to 10 countries and representing 10% of its production, by 2018. That will allow the company to reduce its debt which has ballooned following the $53 billion takeover of BG Group.

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Joint-venture partners in Browse open to new options

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  • The Australian
  • 12:00AM August 30, 2016

The one thing that the Woodside Petroleum-led Browse project has never had much of is unity among the project partners. But that may quietly be changing.

DataRoom understands that the various joint-venture partners in Browse are open to new development options for the project, and that the pipeline option floated by Woodside last week is increasingly being seen by all the partners as the most sensible plan as it stands today.

Woodside chief Peter Coleman told journalists on Friday that the option of connecting Browse to the big but ageing North West Shelf liquefied natural gas plant via a massive 1000km subsea pipeline was back on the table.

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Is energy industry ready to join open source world?

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By David Hunn: August 26, 2016

Landmark, a technology unit of the energy services company Halliburton, is betting that it is, unveiling a cloud-computing platform last week that will allow companies to collaborate on developing software to process the massive volumes of data they collect on everything from geology to seismology to chemistry to drilling to flows of oil and gas. The idea is that easy and open access to the code on which the platform is based will lead to faster and better analysis of the data and ultimately to innovations that allow the industry to extract more oil and gas at lower costs.

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Why I’ve sold all of my Shell and BP shares, by manager of £543 million

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Screen Shot 2016-07-29 at 16.46.22Bailey concluded his comments with the remark that the Shell dividend is uncovered. That means the company is not generating enough cash to pay the dividend itself.

David Thorpe 25 Aug 2016

Stephen Bailey, who runs the Liontrust Macro Equity Income fund has revealed the reasons why he has sold all of his shares in Shell and BP.

He began selling his Shell shares about a year ago, and completed the sale, ‘during the month of August’ 2016.

Bailey commented, ‘A year ago we had 9 per cent of the fund in oil, now it’s zero. You have to look at the macro view on this, and be very concerned about the oil market. The big suppliers in the market can no longer be controlled by OPEC, the Saudis recently announced an initiative called project 2030 which is aimed at boosting other areas of the economy, and they are doing that because they expect to receive less revenue from fossil fuels in the future.’  

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Can OPEC save BP plc and Royal Dutch Shell plc?

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By Ian Pierce – Thursday, 25 August, 2016

Oil majors must long for the halcyon days when a sustained period of low crude prices could be expected to send OPEC riding to the rescue with sweeping production cuts and a promise to boost global prices. Now, two years into a global supply glut that shows few signs of lifting, do oil majors need an OPEC to finally take action?

BP (LSE: BP) wouldn’t say no to the help. Interim results released last month saw underlying replacement cost profits, its preferred metric of profitability, slump 67% year-on-year. Add in a $2bn statutory loss for the period and net debt leaping to $30.9bn and worries have rightly begun to proliferate that dividends will be slashed sooner rather than later.

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Oil major debt climbs to record high as crude prices continue to wallow

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Billy Bambrough is City A.M.’s deputy news editor. Wednesday 24 August 2016

Some of the biggest global oil majors are being weighed down by record levels of debt.

Exxon Mobil, Royal Dutch Shell, BP and Chevron hold a combined net debt of $184bn (£138bn) — more than double their debt levels in 2014, according to analysis by the Wall Street Journal.

The drop in the oil price has been blamed for the soaring debt levels. The price of a barrel of oil remains less than half of what it was in the summer of 2014.

The enduring low oil price and soaring debt levels have caused some investors to question whether the majors will be able to fork out for new investments and dividends in coming quarters.

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Largest Oil Companies’ Debts Hit Record High

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Executives at BP, Shell, Exxon and Chevron have assured investors that they will generate enough cash in 2017 to pay for new investments and dividends, but some shareholders are skeptical. In the first half of 2015, the companies fell short of that goal by $40 billion, according to a Wall Street Journal analysis of their numbers.

“Eventually something will give,” said Michael Hulme, manager of the $550 million Carmignac Commodities Fund, which holds stakes in Shell and Exxon. “These companies won’t be able to maintain the current dividends at $50 to $60 oil—it’s unsustainable.”

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Cash flow problems at Shell?

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By Roland Head – Wednesday, 17 August, 2016

Oil and gas giants Royal Dutch Shell (LSE: RDSB) and (LSE: BP) have been among the top performers in the FTSE 100 so far this year. Shell stock is worth 31% more than at the start of January, while BP is up 23%.

But these gains don’t seem to reflect the weak state of the oil market or both companies’ rapidly-growing debt piles. Are investors turning a blind eye to the risk of a dividend cut in pursuit of the 7% yields available on both stocks?

Cash flow problems at Shell?

Shell’s interim results showed that the firm’s net debt has rocketed from $25.9bn one year ago to $75.1bn today. Much of this is due to the BG acquisition. I expect Shell to be able to refinance a lot of BG’s debt at much lower interest rates than those paid by BG.

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Exclusive: Iraq, oil companies agree to restart investment, boost output

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Exclusive: Iraq, oil companies agree to restart investment, boost output


Iraq has reached agreement with BP, Shell and Lukoil to restart stalled investment in oil fields the firms are developing, allowing projects that were halted this year to resume and crude production to increase in 2017, Iraqi oil officials said.

The agreements, reached in July and August, effectively delay to the second half of the year projects that the three companies had planned to carry out in the first half, which had been suspended because of low oil prices.

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Crude Slump Sees Oil Majors’ Debt Burden Double to $138 Billion

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Screen Shot 2016-07-29 at 16.46.22“On the debt, it may go up before it comes back down,” Shell Chief Financial Officer Simon Henry told investors last week. “And the major factor is the oil price.”

By Javier Blas: August 5, 2016

When commodity prices crashed in late 2014, oil executives could look at their mining counterparts with a sense of superiority.

Back then, the world’s biggest oil companies enjoyed relatively strong balance sheets, with little borrowing relative to the value of their assets. Miners entered the slump in a very different state and some of the world’s largest — Rio Tinto Plc, Anglo American Plc and Glencore Plc — had to reduce dividends and employ draconian spending cuts to bring their debt under control.

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Is this the beginning of the end for Royal Dutch Shell plc and BP plc?

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By Rupert HargreavesThe Motley Fool  Aug 4, 2016

Over the past 10 years, the oil industry has changed dramatically. Technological advances have helped reduce the cost of extracting oil from unconventional sources significantly, and as oil prices have plunged over the past two years, shale oil producers have ploughed more time and resources into pushing costs even lower.

As a result of this unrelenting drive to reduce costs and improve efficiency, it’s estimated that the majority of US shale fields can break even with oil at $60 a barrel. Scott Sheffield, the outgoing chief of Pioneer Natural Resources claims that Pioneer’s pre-tax production costs have fallen to $2.25 a barrel.

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How Exxon Mobil, Royal Dutch Shell, BP Are Affected by Low Oil Prices

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By Muhammad Ali Khawar on Aug 1, 2016 at 7:57 am EST

Just when you thought oil prices will rebound they got even worse. The last few weeks have been quite eventful for the oil and gas industry, with companies releasing their second-quarter earnings. The quarter hasn’t been as rewarding for integrated oil and gas majors.

The decline in crude oil price has persisted for quite a while now. West Texas Intermediate was down 0.50% at $41.40 per barrel, while Brent Crude was down 0.32% at $43.39 per barrel, earlier today.

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Oil giants’ profits on the skids as crude price dives

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  • The Wall Street Journal
  • 12:00AM August 1, 2016

The world’s biggest oil companies posted losses or steep declines in profit for the second quarter, and now face a daunting remainder of the year as crude prices retreat to about $US41 a barrel.

ExxonMobil on Friday reported its quarterly profit fell 60 per cent to the lowest level since 1999, while Chevron disclosed its biggest quarterly loss since 2001. The results capped a bad week for big Western oil companies: BP and Royal Dutch Shell earlier posted earnings that disappointed investors.

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Oil Giants Find There’s Nowhere to Hide From Doomsday Market

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By Joe CarrollJuly 29, 2016 — 1:02 PM BST: Updated on July 30, 2016 — 5:01 AM BST

Exxon Mobil Corp. and Royal Dutch Shell Plc this week reported their lowest quarterly profits since 1999 and 2005, respectively. Chevron Corp.’s third straight loss marked the longest slump in 27 years, and BP Plc lodged its lowest refining margins in six years.

Welcome to year two of a supply overhang so persistent it’s upsetting industry expectations that the market would return to a state of balance between production and demand. It’s left analysts befuddled and investors running to the doorways as the crude market threatened to tip into yet another bear market, dashing hopes that a slump that began in mid 2014 would show signs of abating.

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This Is Why Oil Firms Suffered Another Awful Earnings Season

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Screen Shot 2016-07-30 at 15.00.46BKatie Fehrenbacher: JULY 29, 2016

Analysts expected the oil giants’ cost cutting to help more.

Many of the world’s biggest oil companies continue to feel the pain as low oil prices continue to undercut profits and lead to shuttered projects and layoffs.

Exxon, Royal Dutch Shell, Statoil, BP, and Chevron announced dismal earnings this week, missing expectations and showing how slashing spending and pulling back isn’t yet enough in a world where oil has dropped from a high of $115-per-barrel in 2014 to a low of $27-per-barrel in January of this year.

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Shell’s Debt Nears Edge of Comfort Zone as Rout Boosts Borrowing

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Net debt increased to a record $75 billion at the end of June from $70 billion three months earlier, Shell said Thursday as it reported a slump in second-quarter earnings. Additional borrowing drove up the ratio of net debt to capital, or gearing, to 28.1 percent — more than double the year-earlier level.

“We’re close to the maximum level and it could go up still with the oil price where it is,” Chief Financial Officer Simon Henry said on a conference call. “Thirty percent is an upper limit to where we can describe our position as comfortable.”

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Shell: Paradise Postponed

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By Chris Hughes: July 28, 2016

Royal Dutch Shell has delivered a shock.

Weeks after cheering investors with a big plan for living within its means, the oil major’s second-quarter earnings plummeted from $3.4 billion to $239 million. Paradise — a cash-generative company driven by February’s $64 billion acquisition of BG Group — has been postponed.

So much for the benefits of BG. This was the first set of numbers to include a full contribution for the acquisition, and so far the deal has pushed indebtedness higher while introducing a raft of one-off integration costs.

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Oil giants hit amid fears of drop in demand

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PUBLISHED: 25/07/2016

The FTSE 100 index was off 20.4 points to 6710.13, as Brent crude sunk 1.9% to 44.83 US dollars (£37.50) a barrel after a report from Barclays warned global oil demand was down amid lacklustre growth from the global economy.

BP dropped 2.6%, or 11.8p, to 440.4p ahead of its interim results on Tuesday, while rival Royal Dutch Shell was also languishing in the red, slipping 2.5%, or 54.5p, to 2093.5p.

Sterling was also under pressure after a report from the Confederation of British Industry (CBI) said business optimism had deteriorated at its fastest pace since January 2009 following the Brexit vote.

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Next Week Is as Good as It Gets for Big Oil

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ByRakteem Katakey and Joe Carroll: 22 July 2016

Several majors expected to post highest earnings in 3 quarters

Strong performance may not last as oil seen easing back to $40

For oil companies, the second quarter might be as good as it gets.

Shares gained more than in any other industry, thanks to crude rising from a 12-year low. Profits were the best in at least three quarters for majors including Royal Dutch Shell Plc, Chevron Corp. and BP Plc, helped by cost cuts, analysts say. The rest of the year might not be as rosy as supply holds near record levels.

The combined market value of the world’s oil companies shrank by $2 trillion in the past two years following crude’s collapse. While analysts agree the worst of the oversupply is over, BNP Paribas SA and JBC Energy GmbH are among those forecasting a slide back to $40 a barrel as output rebounds in Canada, Iran, Nigeria and the U.S., hurting producers whose investment cuts have put future growth in doubt.

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Royal Dutch Shell: Huge Dividend And Long-Term Growth Ahead

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Wayne Duggan: 20 July 2016

A number of British stocks have been hit hard since the referendum vote to leave the EU, but Royal Dutch Shell (RDS.A, RDS.B) is not one of them. Shares are now up 0.3% since the Brexit vote after initially falling more than 8% during the knee-jerk market sell-off.

With the possibility that the Brexit could severely impact British GDP growth in coming years, RDS.B offers a unique opportunity to invest in a company within a sector that is in a global upswing, a company that has significant international exposure and a company that is committed to maintaining the single largest dividend payment in the MSCI World Index.

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American Gas Will Be First to Pass Through Expanded Panama Canal

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Naureen Malik: July 19, 2016

Shell set to send tanker carrying U.S. LNG through canal

BP scheduled to send second tanker through the following day

The first cargo of liquefied natural gas set to pass through the newly expanded Panama Canal locks will be American.

Royal Dutch Shell Plc’s Maran Gas Apollonia vessel is scheduled to pass through the canal linking the Atlantic and Pacific oceans on July 25 after loading LNG from the U.S. Gulf Coast, according to the Panama Canal Authority, which oversees the locks’ operations. BP Plc’s British Merchant LNG tanker is expected to become the second to pass through the canal the following day and a third tanker is slated for early August, the agency said in a statement late Monday.

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Getting Ready for Another Round of Commodity Market Downturn

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By Staff Writer on Jul 18, 2016 at 7:30 am EST

Crude oil prices have dropped below the $50 per barrel mark yet again after hitting their highest level in 2016 last month. US crude benchmark, West Texas Intermediate (WTI) is trading at $45.97 per barrel while Brent is trading at $47.69 per barrel in European Markets today. The global crude oil benchmark reached as high as $52.51 per barrel earlier in June.

Although oil prices have recovered some momentum after touching 12-year lows of $27 per barrel earlier in 2016, it still has a lot of ground to gain before reaching summer-2014 levels. Oil market showed some positive gains in June when oil prices crossed the psychological barrier of $50 per barrel. However, it was short-lived as it is currently trading below $48 per barrel.

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Royal Dutch Shell Vs BP plc: Who’s Better Equipped to Tackle the Downturn?

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By Muhammad Ali Khawar on Jul 15, 2016 at 10:04 am EST

Royal Dutch Shell plc. (ADR) (NYSE:RDS.A) finally closed its $52 billion merger with BG group in February. The deal is considered as one of the largest mergers in the oil and gas sector and is expected to help Shell diversify its operations and benefit from cost synergies.

The Shell-BG merger comes at a time when oil prices have plummeted significantly. Oil prices that once traded over $110 per barrel have now tumbled to as low as $50 per barrel. Last year, when Shell approached BG for the first time, many criticized the deal especially because of the 50% premium Shell was willing to pay in a depressed crude environment.

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Uncertainty in the oil price war

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By Ed Crooks: JULY 15. 2016

“War is the realm of uncertainty,” wrote the great Prussian military theorist Carl von Clausewitz. “Three quarters of the factors on which action in war is based are wrapped in a fog of greater or lesser uncertainty.”

That applies to price wars every much as it does to the real kind. Almost from the moment crude began falling in 2014, news outlets started running confident-sounding claims that one side or another was winning the battle often depicted as a struggle between Saudi Arabia on one side and US shale producers on the other.

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BP’s big bill for the world’s largest oil spill reaches $61.6 billion

Screen Shot 2016-07-15 at 15.57.32By Steven Mufson July 14 at 7:15 PM

What’s bigger than the value of Ford, Honda or General Motors? As big as the biggest U.S. electric utility? Eight times the size of Staples and Office Depot combined — if a judge hadn’t blocked their merger?

The answer: the $61.6 billion cost to BP of the 2010 oil spill in the Gulf of Mexico.

On Thursday, BP issued its final estimate of the cost of the spill, the largest in U.S. history. The company said that it would take a pre-tax charge of $5.2 billion in the second quarter of this year and added that would be enough to cover anything that hasn’t been resolved.

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Iraq Inquiry Shows Oil Was a Consideration for U.K. Before War

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British officials held talks with BP and Shell about Iraqi oil

Blair said high oil price was his big “domestic worry”

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By Javier BlasJuly 6, 2016 — 4:27 PM BST

The U.K. government held talks with Royal Dutch Shell Plc and BP Plc to ensure British energy companies were “well-placed to pick up contracts in the aftermath” of the invasion of Iraq, according to declassified documents released as part of an official inquiry.

Although the report, overseen by former civil servant John Chilcot, doesn’t explicitly say oil played a role in the war, documents publish on Wednesday show British officials discussed how to obtain “substantial business for U.K. companies” in the energy sector.

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Oil Prices and the Brexit: What Just Happened

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By Matthew Dilallo: 24 June 2016

What: Crude prices tumbled on Friday after Britain’s stunning decision to leave the European Union. By mid-afternoon, oil was down 4.5% and back below $50 a barrel. The sell-off washed over into oil stocks, with British giants BP (NYSE:BP) and Royal Dutch Shell (NYSE:RDS-A)(NYSE:RDS-B) both following crude downward by more than 5% as of 12:30 p.m. EDT.

Those moves, however, were tame compared to the sell-offs of other European oil stocks, with Statoil (NYSE:STO) and Total (NYSE:TOT) down nearly 6% and 9%, respectively. Even large independent U.S. oil companies were taking it on the chin, with ConocoPhillips (NYSE:COP) just one among the many oil stocks sliding in parallel with the price of crude.

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Oil Explorers Embrace the Sharing Economy to Drill Cheaper Wells

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Screen Shot 2016-06-07 at 23.34.38By Rakteem KatakeyJune 22, 2016 — 12:01 AM BST

The biggest oil-industry downturn in a generation has companies collaborating in ways they never thought possible.

In this global effort, one of the world’s most expensive oil regions intends to lead the way. Last month companies operating in the North Sea started pooling spare parts and tools, and they are even sharing plans on how to drill wells so they can work faster and cheaper, said Paul Goodfellow, Royal Dutch Shell Plc’s vice president for the U.K. and Ireland.

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This is a big change from oil’s boom, when costs weren’t such an issue as long as $100-a-barrel crude kept flowing. As companies focus on adapting to prices closer to $50 by making their spending less wasteful, they also aim to boost profitability for years to come by keeping costs low as markets recover.

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Short term strength

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By Ed Crooks: June 17, 2016

This week has brought evidence of contrasting short-term and long-term trends in the oil market. In the short term, demand and supply are both turning out to be stronger than many had expected. The IEA revised up its forecast for oil demand growth this year in its monthly oil market report, but added that rising production would mean global oversupply could persist into 2017.

There are early indications of an upturn in activity in the US shale industry, still faint so far, but ominous for anyone relying on a sharp rebound in crude. And Iran said its oil production had reached 3.8m barrels per day, confirming the strong growth following the lifting of sanctions that was already visible last month. Iran’s oil exports have tripled since late 2015.

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Global oil majors look to shed refineries as crude prices rebound

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Global oil majors Chevron Corp and Royal Dutch Shell Plc are putting small refineries on the auction block as they look to trim lower-margin assets in the face of headwinds from rising crude oil prices.

Chevron, the second largest U.S. oil company, is soliciting interest in its Burnaby, British Columbia, refinery and gasoline stations, the company told Reuters. Shell is looking for buyers for its Martinez, California, refinery, two people familiar with the situation told Reuters. Shell declined to comment.

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Royal Dutch Shell plc (ADR) to Increase Exposure to LNG Market

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By Staff WriterJun 15, 2016

Royal Dutch Shell plc (ADR) (NYSE:RDS.A) plans to further strengthen its foothold in the liquefied natural gas (LNG) market, as according to Reuters, the company will sign the Baltic LNG project deal with Russian energy giant, Gazprom in the coming days. The multi-billion dollar deal with London-based BG Group has already increased the company’s exposure to the LNG segment.

According to news sources, Shell CEO, Ben van Beurden, will sign the deal at the International Economic Forum in St. Petersburg. Russian President, Vladimir Putin, is also expected to attend the meeting.

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