Natural Gas Daily: April 30th, 2020
Shell Slips into Red in Q1, Cuts Dividends
Anglo-Dutch major Shell has followed other European companies in swinging to a loss in the first quarter, according to results published on April 30, on the back of lower oil, gas and LNG prices, weaker refining and chemical margins and lower sales volumes.
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The Big Picture:
- Shell also said that its board had decided to cut quarterly dividends to $16/share, effective from the first quarter. This marks the first time the Anglo-Dutch major has reduced its shareholder dividend since the Second World War.
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In the past few days, BP, ConocoPhillips, Italy's Eni, and Austrian OMV have all published losses following the collapse in oil demand and energy prices.
ExxonMobil Maintains Dividends Despite Price Crunch
ExxonMobil said on April 29 it would maintain dividends at $0.87/share for the second quarter, unchanged from the payment for the first quarter, despite the collapse in oil prices.
The Big Picture:
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BP has also maintained dividends, whereas Shell has slashed its payments by 45%.
Norway has agreed to cut its production for the first time in almost two decades to support Opec+'s efforts to rebalance the market, its energy ministry announced late on April 29.
The Big Picture:
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At the time of press, Brent was up almost 15% at $26/b, with Rystad attributing the rise to Norway announcing the cut and a growth in US gasoline demand.
LNG Developer Cheniere Reports Strong Q1
US LNG developer Cheniere Energy said its Q1 2020 net income was 166% higher year-on-year, at $375mn versus $141mn, while pre-tax earnings more than doubled, to $1.04bn from $650mn.
The Big Picture:
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Most of its capacity is presold on a liquefy-or-pay basis, guaranteeing income whatever the circumstances, although it has reserved some capacity for its own use.
Sinopec Reports $2.8bn Loss in Q1
Chinese state-run Sinopec slipped into the red during the three months to March 31 (Q1 2020) due to the sharp decline in average realised oil and gas prices, it said on April 29 in a statement.
The Big Picture:
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Sinopec’s average realised crude oil price during Q1 was down 14.8% yr/yr while average realised gas price was down 9.2% from a year ago, it reported.
- Fellow state-run company PetroChina reported a net loss of $2.3bn, it said on April 29 in a stock exchange filing.
Azerbaijan Breaks Down Production Cut
Azerbaijan state oil producer Socar outlined on April 30 how the country's output cuts under the Opec+ deal would be shared among its producers. The group has agreed to produce less oil from May 1.
The Big Picture:
- The Azeri-Chirag-Gunashli (ACG) oil project led by BP will bear the lion's share of the cuts.
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Azerbaijan has been restricting its supply for more than three years as a member of the Opec+ group, but it has never before asked the ACG consortium to take part, because of the project's importance to the Azeri economy.
