Equinor eyes tighter gas market as lower oil prices hit Q2 profit
Europe's biggest gas producer said the prospect of a rebound in pipeline gas flows from rival supplier Russia had also diminished in recent months, citing political opposition in Germany and elsewhere.
Equinor reported on Wednesday a 13% drop in second-quarter profits, as expected, as declining oil prices outweighed an increase in the price of gas in Europe and the United States.
The Norwegian energy group's adjusted earnings before tax for April-June fell to $6.54 billion from $7.48 billion a year earlier, in line with the $6.53 billion predicted in a poll of 21 analysts compiled by the company.
EU gas stores are currently 65.4% full, according to data from Gas Infrastructure Europe, down from around 83% at the same time last year.
"This can create a more tight (gas) market during the autumn or during the winter," CEO Anders Opedal told Reuters on the sidelines of Equinor's earnings presentation.
The supply situation remains dependent on factors such as the weather-related demand and production regularity, as well as imports from outside the region, he added.
"In June, we saw 25% less LNG ships into Europe compared to before, meaning that the competition tightens a little bit," Opedal said.
Equinor maintained a projection that its oil and gas output would increase by 4% this year compared to 2024 and kept its forecast for capital expenditure in 2025 of $13 billion.
The company on Wednesday booked a $955 million writedown on an offshore wind project in the United States, citing U.S. tariffs and the uncertainty of the regulatory environment under President Donald Trump.
In February, Equinor followed rivals such as Shell (SHEL.L), opens new tab and BP (BP.L), opens new tab in promising higher oil and gas output while scaling back investment in renewables, citing challenging market conditions for the green energy transition.
Equinor in the second quarter pumped 2.1 million barrels of oil equivalent per day (boed), slightly ahead of expectations in the analyst poll for 2.06 million boed, and up from 2.05 million boed a year earlier.
Equinor's share price was down 1% at 1145 GMT, lagging a 1.6% rise in the European energy stock index (.SXEP), opens new tab.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Reuters
24 minutes ago
- Reuters
Shein's UK sales surge to $2.8 billion in 2024, boosting profits as IPO looms
LONDON, Aug 15 (Reuters) - Shein's British business made 2.05 billion pounds ($2.77 billion) in sales in 2024, a 32.3% increase from the previous year, a filing by the online fast-fashion retailer showed early on Friday. Shein does not report global results publicly, but the filing sheds light on its growth in Britain, its third-biggest market after the United States and Germany, as the company works toward an initial public offering in Hong Kong. Founded in China and headquartered in Singapore, Shein has spent years attempting to list, first in New York and then in London, but faced criticism from U.S. and UK politicians and failed to get approval from China's securities regulator for the offshore IPO at a time of increasing tensions between China and the U.S. The global retailer's UK business, Shein Distribution UK Ltd, reported a pretax profit of 38.25 million pounds in 2024, up 56.6% from 24.4 million pounds in 2023. In the filing, Shein highlighted 2024 milestones, such as a pop-up shop in Liverpool, a Christmas bus tour across 12 UK cities and the opening of two new offices in Kings Cross and Manchester. Known for deeply discounted pricing, Shein runs constant promotions and offers coupons or rewards that encourage shoppers to keep buying. Shein has taken market share from retailers like ASOS (ASOS.L), opens new tab and H&M ( opens new tab as surging inflation dented consumers' spending power, driving them to hunt for bargains. Shein has also broadened its offering beyond fashion — the UK site sells 7.99-pound ($10.84) dresses and 15-pound ($20.36) jeans, as well as everything from toys and craft supplies to storage units. Shein's business has benefited from customs duty exemptions on low-value e-commerce packages that allow it to send goods directly from factories in China to shoppers' doorsteps largely tariff-free. But that perk is on its way out, driving Shein's costs — and prices — up, particularly in the U.S., where imports from China are now subject to steep tariffs. U.S. President Donald Trump's administration has scrapped its "de minimis" exemption for parcels under $800, and the European Union plans to remove its equivalent duty waiver on e-commerce parcels worth less than 150 euros. Britain is also reviewing its policy on low-value imports after retailers said it was giving online players like Shein and Temu an unfair advantage.
Reuters
an hour ago
- Reuters
Online retailer Shein's UK revenue grew 32% in 2024
LONDON, Aug 15 (Reuters) - Shein's British business made 2.05 billion pounds ($2.77 billion) in sales in 2024, a 32.3% increase from the previous year, a filing by the online fast-fashion retailer showed early on Friday. Shein does not report global results publicly, but the filing sheds light on its growth in Britain, its third-biggest market after the United States and Germany, as the company works toward an initial public offering in Hong Kong. Founded in China and headquartered in Singapore, Shein has spent years attempting to list, first in New York and then in London, but faced criticism from U.S. and UK politicians and failed to get approval from China's securities regulator for the offshore IPO at a time of increasing tensions between China and the U.S. The global retailer's UK business, Shein Distribution UK Ltd, reported a pretax profit of 38.25 million pounds in 2024, up 56.7% from 24.4 million pounds in 2023.
Reuters
an hour ago
- Reuters
The US economy's key weak spots in five charts: McGeever
ORLANDO, Florida, Aug 14 (Reuters) - The U.S. economy seems to be chugging along fairly smoothly, if a little too slowly for some observers' liking. Under the bonnet, however, the picture is more worrisome, and the risk of engine malfunction is rising. Technology's role in the U.S. economy has never been greater, and artificial intelligence could deliver a historic productivity boom. But return on the huge investment being made on that bet could take years to materialize. What's more, an unbalanced economy may not be desirable in the long term, as it can lead to poor investment and policy decisions. Below are five charts that indicate the foundations of the resilient U.S. economy and booming stock market may be much shakier than they appear, especially if AI- and tech-related spending, investment and optimism are stripped out. Inflation-adjusted investment in 'AI-sensitive' sectors of the economy since the end of 2019 has risen 53%, notes Troy Ludtka, senior U.S. economist at SMBC Nikko Securities. Investment elsewhere has inched up just 0.3%. Relatedly, the contribution of software and IT equipment capex to U.S. GDP has never been higher, according to analysts at BlackRock. Aggregate capex in all other areas of the economy, however, actually fell in the first half of this year – a rare occurrence. Meanwhile, personal consumption expenditures are slowing sharply, a worrying sign given that the consumer accounts for around 70% of total U.S. GDP. Personal consumption expenditures in the second quarter grew by only 0.9%, the slowest pace since the pandemic. And in real terms, consumer spending has completely flat-lined in the first half of the year. Corporate bankruptcies in July were the highest for a single month since July 2020, according to S&P Global Market Intelligence. Even more alarming, the tally of year-to-date bankruptcy filings through the end of July was the highest for this seven-month period since 2010. Nearly a third of this year's bankruptcies were in the consumer discretionary and industrial sectors. Finally, the concentration on Wall Street has been widely discussed, but the levels continue to be eye-popping. One stock, chipmaker Nvidia, accounts for 8% of the benchmark S&P 500's entire market cap. That's a record for a single name. And the top 10 stocks, most of which are Big Tech megacaps, make up 40% of the index's market cap and 30% of all earnings. These are also record levels. The more Wall Street – and even global markets - rely on the revenue, earnings and profitability of a set of companies that can be counted on two hands, the bigger the potential mess could be if the trends driving these companies' performance lose momentum. (The opinions expressed here are those of the author, a columnist for Reuters)
