Core Insights - The decline in oil prices over the past year has negatively impacted the earnings of major oil companies, with prices around $60 per barrel compared to $100 in 2022 and $80 in 2023 and 2024, indicating that shareholder returns may not be sustainable going forward [1] Group 1: Impact on European Oil Majors - European oil firms may announce cuts to their share buybacks in response to lower oil prices [2] - Analysts predict that European majors could reduce buybacks by 10% to 25% due to sustained low oil prices [6] - Companies like BP, Shell, TotalEnergies, Equinor, and Eni are expected to report lower earnings for the fourth quarter compared to the third quarter, influenced by low liquids prices and reduced chemicals margins [7] Group 2: Comparison with U.S. Peers - U.S. supermajors, such as ExxonMobil and Chevron, have maintained their share repurchase programs and reiterated buyback plans through 2026 under reasonable market conditions [3] - Unlike European firms, U.S. companies have not shifted their focus away from oil production, maintaining high-margin assets [4] Group 3: Strategic Adjustments - European majors are currently adjusting their strategies to focus back on oil and gas while reducing investments in renewables [4] - TotalEnergies has indicated plans to lower buybacks for the fourth quarter of 2025 and for 2026, aligning with hydrocarbon prices and refining margins [8]

Key Takeaways Equinor will report 4Q25 results on Feb. 4, with consensus EPS expected to fall 4.8% y/y to 60 cents.EQNR revenues are estimated at $23.44B, indicating a 15.2% decline, as Q4 crude prices fell sharply y/y.EQNR's plan to divest 40% of its Peregrino stake in the fourth quarter of 2025 may hit earnings.Equinor ASA (EQNR) is set to report fourth-quarter 2025 results on Feb. 4.In the last reported quarter, the large-cap integrated company’s adjusted earnings of 37 cents per share missed the Zacks C ...

Core Viewpoint - Equinor has agreed to sell its onshore assets in Argentina's Vaca Muerta basin to Vista Energy for approximately $1.1 billion, which includes a cash payment and contingent payments based on production and oil prices over five years [1][2]. Group 1: Transaction Details - The sale includes a 30% non-operated stake in the Bandurria Sur licence and a 50% non-operated stake in the Bajo del Toro asset [1]. - Equinor will receive an upfront cash payment of $550 million and shares in Vista upon closing [1]. - The transaction is scheduled to take effect on July 1, 2025, and does not impact Equinor's offshore holdings in Argentina [2]. Group 2: Strategic Implications - The sale is part of Equinor's strategy to enhance financial flexibility and focus on core international markets, with expectations of production and cash flow growth by 2030 [2][3]. - Equinor's production from Bandurria Sur averaged 24,400 barrels of oil equivalent per day, while Bajo del Toro contributed 2,100 boepd in Q3 2025 [3]. - The company retains optionality through its offshore positions in Argentina, which include exploration licences acquired in 2019 [4]. Group 3: Future Prospects - Equinor's international portfolio is expected to expand, particularly through operations in Brazil, the US, and the UK [2]. - The offshore exploration licences in Argentina are currently undergoing subsurface evaluation to identify commercially viable opportunities [4]. - Recent discoveries in the Norwegian North Sea indicate ongoing exploration success, with initial estimates of recoverable oil equivalent at the Lofn prospect ranging from 3.5 to 10 million standard cubic metres [5].

Core Viewpoint - Equinor has agreed to divest its entire onshore portfolio in Argentina's Vaca Muerta basin to Vista Energy for approximately $1.1 billion, as part of its strategy to streamline its international upstream operations [1]. Group 1: Transaction Details - The deal includes Equinor's non-operated stakes in two shale assets: a 30% interest in Bandurria Sur and a 50% interest in Bajo del Toro [2]. - Equinor will receive $550 million in upfront cash at closing, along with shares from Vista Energy, with additional contingent payments linked to future production levels and oil prices over a five-year period [3]. - The transaction is effective from July 1, 2025, and is subject to regulatory and customary approvals [3]. Group 2: Strategic Rationale - The sale reflects Equinor's value-driven approach to portfolio management, prioritizing capital allocation towards core international markets [4]. - The divestment supports Equinor's broader effort to high-grade its portfolio and enhance financial flexibility [4]. Group 3: Historical Context - Equinor has been involved in Argentina's upstream sector since 2017, entering Vaca Muerta through a joint exploration agreement with YPF at Bajo del Toro [5]. - The company expanded its onshore presence in 2020 by acquiring a stake in Bandurria Sur, which is one of the basin's more advanced development areas [5]. Group 4: Production Insights - Production from Bandurria Sur has significantly contributed to Equinor's output in Argentina, averaging about 24,400 barrels of oil equivalent per day in the third quarter of 2025 [6]. - Bajo del Toro is still in the early development stage, producing approximately 2,100 net barrels of oil equivalent per day [6]. Group 5: Industry Context - Vista Energy, a major independent operator in Argentina's shale sector, is consolidating its position in Vaca Muerta as international players reassess capital deployment in higher-cost or non-core regions [7]. - The acquisition enhances Vista's operated footprint in the basin, recognized as one of the largest unconventional oil and gas resources globally [7]. Group 6: Future Outlook - While exiting onshore operations, Equinor retains its offshore exploration exposure in Argentina, holding eight offshore licenses across various basins acquired in 2019 [8]. - Ongoing subsurface studies are being conducted, with no current drilling commitments associated with those licenses [8].

Core Viewpoint - Norway's Equinor has agreed to sell its onshore business in Argentina's Vaca Muerta basin to Vista Energy for a total of $1.1 billion, with half of the payment made in cash and the other half in Vista shares [1] Group 1 - The sale price of $1.1 billion reflects Equinor's strategic decision to divest from its onshore operations in Argentina [1] - The transaction structure includes a combination of cash and equity, indicating Vista Energy's confidence in its future growth potential [1] - Vaca Muerta basin is known for its significant shale oil and gas reserves, making it a key area for investment in the energy sector [1]

Danske Bank upgraded Equinor ASA (NYSE:EQNR) from Sell to Hold, reflecting a more optimistic view on its stock performance.Equinor's strong 6% dividend yield offers portfolio safety, making it an attractive investment amidst European natural gas supply concerns.The company's market capitalization of approximately $66.5 billion and active trading volume highlight its significant role in the energy sector.Equinor ASA, listed on the NYSE under the symbol EQNR, is a major player in the energy sector. The compan ...

European natural gas inventories crossed below the five-year average at the start of 2025, and as of now, the gap widened to over 20% below the five-year average. It is a gap that amounts to about 17Analyst’s Disclosure: I/we have a beneficial long position in the shares of EQNR, LNG either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationsh ...

Summary of Key Points from the Conference Call Industry Overview - The focus is on the upcoming 4Q25 earnings season for Europe's Big Oils, starting with Equinor on February 4th, 2026, and the guidance for 2026 is expected to be a key topic [1][9] - The preference ranking for investment is Oil Services > Big Oils > Exploration & Production (E&Ps), with TotalEnergies (TTE) highlighted as the top pick among Big Oils [1] Core Insights and Arguments - The $60/bbl Brent price assumption is challenging for Europe's Big Oils, leading to a projected decline in refining margins by 35% compared to 4Q25 [2] - Capital expenditure (capex) budgets are expected to remain flat, with an average buyback cut of approximately 25% across the sector, except for TTE [2] - TTE and Galp are noted for their organically falling breakeven Brent prices, with TTE's Integrated Power business transitioning from a drag to a contributor to free cash flow (FCF) [3][11] - TTE's recent trading update has positively influenced consensus estimates, contrasting with downgrades from peers like BP and Shell [4] Financial Projections - The aggregate organic cash flow from major companies is projected to show a $16 billion deficit post distributions, which decreases to approximately $5.5 billion after accounting for inorganic cash flows [13] - TTE is expected to have the lowest organic breakeven price in the peer group at around $60/bbl for 2026, with projections of it dropping below $55/bbl by 2027 [14][16] - TTE's capex is anticipated to decline by over 10% year-on-year in 2026, with a significant reduction expected by 2028 [17][20] Balance Sheet and Debt Analysis - The analysis indicates that all Big Oils will reduce shareholder distributions in 2026 compared to 2025, with Equinor expected to see the most significant declines [22] - BP is projected to maintain the highest gearing in the peer group at around 40%, while TTE and Galp are expected to decrease their net debt year-on-year [31][36] Market Sentiment and Consensus - The consensus estimates for 4Q25 earnings have been revised down by 8% year-to-date, with TTE showing a rare positive update that has led to flat revisions compared to an average 8% downgrade across peers [49] - The overall sentiment indicates a cautious outlook for cash flows, with aggregate payouts expected to exceed 140% of organic FCF at the $60/bbl Brent price [10] Upcoming Catalysts - Key upcoming earnings reports include Galp and Equinor on February 4th, followed by several other companies throughout February [62] Additional Insights - The report emphasizes the importance of cash flow cushions and balance sheet strength, particularly for TTE and Equinor, as they navigate the challenging oil price environment [10][11] - The analysis suggests that the market may have already priced in the expected cuts to buybacks, indicating a potential for volatility in stock performance as earnings reports are released [65] This summary encapsulates the critical insights and projections regarding the oil industry and specific companies, particularly focusing on TotalEnergies and its competitive positioning within the sector.

Group 1 - The core viewpoint indicates that oil price volatility is expected to be the base case for 2026, suggesting a challenging environment for the oil and natural gas sector [2] - The oil and natural gas sector constitutes 16% of the portfolio, with three positions held by the company, highlighting its significance in the investment strategy [2] Group 2 - The analysis suggests that the current market conditions may lead to increased uncertainty in oil prices, which could impact investment decisions in the sector [2] - The company anticipates that the volatility in oil prices will influence overall market dynamics, necessitating close monitoring of industry trends [2]

Tariff Threats and Economic Impact - U.S. President Donald Trump has announced plans to impose 10% tariffs on several European countries, escalating to 25% by June 1, as part of a strategy to acquire Greenland [2] - European political leaders are preparing for emergency talks to discuss potential retaliatory measures and broader economic policies in response to the tariffs [3] Affected Sectors Automotive - The automotive sector is highly vulnerable to the proposed tariffs due to globalized supply chains and reliance on North American manufacturing [4] - Major European car manufacturers, including Volkswagen, BMW, and Mercedes-Benz, experienced stock declines of over 2.5% following the announcement [5] - The tariffs are expected to negatively impact Germany's economic outlook, which is heavily reliant on the automotive industry [7][8] Luxury Goods - Luxury stocks, previously insulated from trade tensions, are now facing potential declines due to the tariffs, particularly affecting French companies like LVMH and Kering [9] - Shares of LVMH and Kering fell approximately 3.5% and 2.6%, respectively, following the tariff threats [10] Pharmaceuticals - The pharmaceutical sector could see significant repercussions, as it represents the EU's largest export to the U.S., with exports valued at €84.4 billion ($98.1 billion) in the first three quarters of the previous year [11] - Major pharmaceutical companies, including Novo Nordisk, Roche, and Sanofi, experienced slight declines in stock prices due to the tariff threats [12] Energy - The energy sector may be indirectly affected by the tariffs, with concerns over weaker global demand and lower crude prices impacting stock performance [13] - Energy stocks like Equinor, TotalEnergies, Shell, and BP saw declines ranging from 1% to 3.4% following the announcement [14] Broader Economic Implications - Analysts predict that the tariffs will have a widespread impact across various sectors, affecting oil prices, commodity prices, equity markets, and debt markets [16]