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World

Davos 2023: Big Oil in sights of climate activist protests

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DAVOS, Switzerland, Jan 16 (Reuters) – Big oil firms came under pressure at the start of the World Economic Forum (WEF) from activists who accused them of hijacking the climate debate, while a Greta Thunberg-sponsored “cease and desist” campaign gained support on social media.

Major energy firms including BP (BP.L), Chevron (CVX.N) and Saudi Aramco (2222.SE) are among the 1,500 business leaders gathering for the annual meeting in the Swiss resort of Davos, where global threats including climate change are on the agenda.

“We are demanding concrete and real climate action,” said Nicolas Siegrist, the 26-year-old organiser of the protest who also heads the Young Socialists party in Switzerland.

The annual meeting of global business and political leaders opens in Davos on Monday.

“They will be in the same room with state leaders and they will push for their interests,” Siegrist said of the involvement of energy companies during a demonstration attended by several hundred people on Sunday.

The oil and gas industry has said that it needs to be part of the energy transition as fossil fuels will continue to play a major role in the world’s energy mix as countries shift to low carbon economies.

[1/5] Climate activists display a banner during a protest ahead of the World Economic Forum (WEF) 2023 in the Alpine resort of Davos, Switzerland, January 15, 2023. REUTERS/Arnd Wiegmann

On Monday, a social media campaign added to the pressure on oil and gas companies, by promoting a “cease and desist” notice sponsored by climate activists Thunberg, Vanessa Nakate and Luisa Neubauer, through the non-profit website Avaaz.

It demands energy company CEOs “immediately stop opening any new oil, gas, or coal extraction sites, and stop blocking the clean energy transition we all so urgently need”, and threatens legal action and more protests if they fail to comply.

The campaign, which had been signed by more than 660,000 people, had almost 200,000 shares on Monday morning.

Sumant Sinha, who heads one of India’s largest renewable energy firms, said it would be good to include big oil companies in the transition debate as they have a vital role to play.

“If oil people are part of these conversations to the extent that they are also committing to change then by all means. It is better to get them inside the tent than to have them outside the tent,” Sinha, chairman and CEO of ReNew Power, told Reuters, saying that inclusion should not lead to “sabotage”.

Rising interest rates have made it harder for renewable energy developments to attract financing, giving traditional players with deep pockets a competitive advantage.

As delegates began to arrive in Davos, Debt for Climate activists protested at a private airport in eastern Switzerland, which they said would be used by some WEF attendees, and issued a statement calling for foreign debts of poorer countries to be cancelled in order to accelerate the global energy transition.

Additional reporting by Kathryn Lurie; Editing by Alexander Smith and Alex Richardson

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Business

Exxon’s record-smashing Q3 profit nearly matches Apple’s

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  • Oil firm smashes Wall Street forecasts with $19.7 billion profit
  • Exxon’s fossil-fuel bets eclipse rivals Shell, TotalEnergies
  • Company projects flat oil output this year on Russia losses

HOUSTON, Oct 28 (Reuters) – Exxon Mobil Corp (XOM.N) on Friday smashed expectations as soaring energy prices fueled a record-breaking quarterly profit, nearly matching that of tech giant Apple.

Its $19.66 billion third-quarter net profit far exceeded recently raised Wall Street forecasts as skyrocketing natural gas and high oil prices put its earnings within reach of Apple’s (AAPL.O) $20.7 billion net for the same period.

As recently as 2013, Exxon ranked as the largest publicly traded U.S. company by market value – a position now held by Apple. Exxon shares rose 3% to $110.70, a record high that gave it a market value of $461 billion.

Oil company profits have soared this year as rising demand and an undersupplied energy market collided with Western sanctions against Russia over its invasion of Ukraine. U.S. exports of gas and oil to Europe have jumped and promise to set all-time profit records for the industry.

The top U.S. oil producer reported a per-share profit of $4.68, exceeding Wall Street’s $3.89 consensus view, on a huge jump in natural gas earnings, continued high oil prices and strong fuel sales.

“Where others pulled back in the face of uncertainty and a historic slowdown, retreating and retrenching, this company moved forward, continuing to invest,” Chief Executive Darren Woods told investors. Its quarterly profits “reflect that deep commitment” as well as higher prices, he added.

Exxon led record gains among oil majors in the second quarter and has leapfrogged Shell Plc (SHEL.L) and TotalEnergies SE (TTEF.PA) with earnings almost twice as big from continued bets on fossil fuels as competitors shifted investment to renewables.

Reuters Graphics Reuters Graphics

Exxon banked $43 billion in the first nine months of this year, 19% more than in the same period of 2008, when oil prices traded at a record level of $140 per barrel.

Earnings from pumping oil and gas tripled last quarter while profit from selling motor fuels jumped tenfold compared with year-ago levels. Natural gas sales to Europe and soaring demand for diesel fuel led the company’s better-than-expected results.

“The refining businesses – both in the U.S. and international – was the star performer,” said Peter McNally, an analyst at Third Bridge.

Those rising fuel profits have renewed calls by U.S. President Joe Biden for companies to invest the windfall from this year’s energy price run-up in production rather than buy back their own shares.

Exxon will maintain its $30 billion share buyback through 2023 while increasing dividends, Chief Financial Officer Kathryn Mikells told Reuters. On Friday, it declared a fourth-quarter per-share dividend of 91 cents, up 3 cents, and will pay $15 billion to shareholders this year.

Exxon said its U.S. oil and gas production from the Permian Basin was near 560,000 barrels of oil and gas per day (boepd), a record. Production for the year will increase about 20% over 2021, said CEO Woods.

“We’re optimizing and adjusting our development plans,” he told analysts, with the full-year production gain below the 25% increase Exxon had forecast in February.

Results also were helped by an almost 100,000-boepd increase over the previous quarter in Guyana, where Exxon leads a consortium responsible for all output in the South American nation.

But its withdrawal from Russia reduced its overall production forecast for the year by about 100,000 barrels per day. Exxon said its Russian assets were expropriated.

“We are going to end up at about 3.7 million barrels a day for the full year,” Mikells said, down from a 3.8 million bpd goal set in February.

Reporting by Sabrina Valle; Editing by Ana Nicolaci da Costa, Jonathan Oatis and Marguerita Choy

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World

Russia’s Sechin says Taiwan will return to China ‘on schedule’

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  • Sechin: China will get Taiwan on time
  • Sechin praises Saudi Arabia
  • Sechin says BP a ‘shadow’ shareholder
  • BP: continuing to pursue an exit

BAKU, Oct 27 (Reuters) – Igor Sechin, chief executive of Russian oil giant Rosneft (ROSN.MM) and one of Vladimir Putin’s closest allies, on Thursday heaped praise on China’s leaders and said Taiwan would return to its “native harbour” on time.

Sechin said that decisions taken by the 20th Communist Party Congress, which cemented Xi Jinping position as the most powerful Chinese leader since Mao Zedong, would provide for a new level of development for the country.

The deepening “no limits” partnership between the rising superpower of China and the natural resources titan of Russia is one of the most intriguing geopolitical developments of recent years – and one the West is watching with anxiety.

“The position of (China’s) leadership is highly respected, which calmly and openly, without false premises, sets out its positions, even on the most difficult issues, such as the problem of Taiwan, which in this regard can be assessed as somewhat exaggerated,” Sechin told an international economic forum in Baku, previously held in Italy’s Verona.

He said U.S. attempts to create its own complex microchip industry showed that “Taiwan’s return to its native harbour” was “on schedule”.

Taiwan’s Foreign Ministry condemned the comments, saying only the island’s people could decide their future.

“Neither our government, people nor the international community can accept absurd remarks that are in China’s cortege or demean Taiwan’s sovereign status,” it said in a statement.

China claims democratically governed Taiwan as its own territory and has ramped up military and political pressure against the island over the past two years. Taipei strongly rejects Beijing’s sovereignty claims.

Russia has repeatedly warned the United States against meddling in China’s affairs while President Vladimir Putin has explicitly backed Xi over the fate of the island where the defeated Republic of China government fled in 1949 after losing the Chinese civil war to Mao’s communists.

BP’S DIVIDEND

Sechin said Rosneft had transferred $700 million in second-half 2021 dividends into special accounts for BP (BP.L), which remained Rosneft’s “shadow” shareholder despite a decision to leave the company following the start of what Moscow calls its “special military operation” in Ukraine.

BP said its position on Russia has remained unchanged.

“In February we announced our decision to exit Rosneft and our other Russian businesses – we continue to pursue that,” it said in emailed comments.

Sechin also said that Saudi Arabia’s position on the global oil market was “reasonable” and based on analysis of oil supply and demand.

The United States, he said, had tried to persuade Saudi Arabia to postpone oil output cuts as part of OPEC+.

“Today, the energy policy of the (Joe) Biden administration is solving exclusively pre-election tasks with a planning horizon of two weeks, given that the elections to the U.S. Congress are on November 8,” Sechin said.

“This includes attempts to persuade Saudi Arabia to at least postpone the announcement of this decision until the elections.”

The OPEC+ group of global leading oil producers, which includes Saudi Arabia and Russia, agreed this month to cut its combined output by 2 million barrels per day despite opposition from the United States, which wants lower fuel prices.

Saudi Arabia rejected criticism of an OPEC+ decision to cut its oil production target despite U.S. objections and said that Washington’s request to delay the cut by a month would have had negative economic consequences.

Reporting by Nailia Bagirova and Olesya Astakhova; Additional reporting by Ron Bousso and Ben Blanchard in London; Writing by Vladimir Soldatkin; Editing by Guy Faulconbridge, Nick Macfie and Mike Harrison

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Business

Exxon, Chevron post blowout earnings, oil majors bet on buybacks

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  • High prices, margins lift majors to best quarters in history
  • Exxon earnings surpass previous record set in 2012

July 29 (Reuters) – The two largest U.S. oil companies, Exxon Mobil Corp (XOM.N) and Chevron Corp (CVX.N), posted record revenue on Friday, bolstered by surging crude oil and natural gas prices and following similar results for European majors a day earlier.

The U.S. pair, along with UK-based Shell (SHEL.L) and France’s TotalEnergies (TTEF.PA), combined to earn nearly $51 billion in the most recent quarter, almost double what the group brought in for the year-ago period.

Exxon outpaced its rivals with a $17.9 billion quarterly profit, the most for any international oil major in history.

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Chevron, Shell and Total ran to catch up with Exxon’s aggressive buyback program, which was kept unaltered.

The four returned a total of $23 billion to shareholders in the quarter, capitalizing on high margins derived from selling oil and gas. The fifth major, BP Plc (BP.L), reports next week. read more

The companies posted strong results in their production units, helped by the surge in benchmark Brent crude oil futures , which averaged around $114 a barrel in the quarter.

High crude oil prices can cut into margins for integrated oil majors, as they also bear the cost of crude used for refined products. However, following Russia’s invasion of Ukraine and numerous shutdowns of refineries worldwide in the wake of the coronavirus pandemic, refining margins exploded in the second quarter, outpacing the gains in crude and adding to earnings.

“The strong second-quarter results reflect a tight global market environment, where demand has recovered to near pre-pandemic levels and supply has attritted,” said Exxon Chief Executive Darren Woods, in a call with analysts. “Growing supply will not happen overnight.”

A combination of file photos shows the logos of five of the largest publicly traded oil companies; BP, Chevron, Exxon Mobil, Royal Dutch Shell, and Total. REUTERS/File Photo

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The results from the majors are sure to draw fire from politicians and consumer advocates who say the oil companies are capitalizing on a global supply shortage to fatten profits and gouge consumers. U.S. President Joe Biden last month said Exxon and others were making “more money than God” at a time when consumer fuel prices surged to records. read more

Earlier this month, Britain passed a 25% windfall tax on oil and gas producers in the North Sea. U.S. lawmakers have discussed a similar idea, though it faces long odds in Congress. read more

A windfall tax does not provide “incentive for increased production, which is really what the world needs today,” said Exxon Chief Financial Officer Kathryn Mikells, in an interview with Reuters.

The companies say they are merely meeting consumer demand, and that prices are a function of global supply issues and lack of investment. The majors have been disciplined with their capital and are resisting ramping up capital expenditure due to pressure from investors who want better returns and resilience during a down cycle.

“In the short term (cash from oil) goes to the balance sheet. There’s no nowhere else for it to go,” Chevron CFO Pierre Breber told Reuters.

Worldwide oil output has been held back by a slow return of barrels to the market from the Organization of the Petroleum Exporting Countries and allies, including Russia, as well as labor and equipment shortages hampering a swifter increase in supply in places like the United States.

Exxon earlier this year more than doubled its projected buyback program to $30 billion through 2022 and 2023. Shell said it would buy back $6 billion in shares in the current quarter, while Chevron boosted its annual buyback plans to a range of $10 billion to $15 billion, up from $5 billion to $10 billion.

Exxon shares were up 4.5% to $96.87 in afternoon trading. Chevron shares rose more than 8% to $163.68.

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Reporting By Sabrina Valle; writing by David Gaffen; Editing by Kirsten Donovan and Marguerita Choy

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Business

U.S. gasoline average price tops $5 per gallon in historic first

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June 11 (Reuters) – The price of U.S. gasoline averaged more than $5 a gallon for the first time on Saturday, data from the AAA showed, extending a surge in fuel costs that is driving rising inflation.

The national average price for regular unleaded gas rose to $5.004 a gallon on June 11 from $4.986 a day earlier, AAA data showed.

High gasoline prices are a headache for President Joe Biden and congressional Democrats as they struggle to maintain their slim control of Congress with midterm elections coming up in November.

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Biden has pulled on numerous levers to try to lower prices, including a record release of barrels from U.S. strategic reserves, waivers on rules for producing summer gasoline, and leaning on major OPEC countries to boost output.

Yet fuel prices have been surging around the world due to a combination of rebounding demand, sanctions on oil producer Russia after its invasion of Ukraine and a squeeze on refining capacity.

DEMAND DESTRUCTION
U.S. road travel, however, has remained relatively strong, just a couple of percentage points below pre-pandemic levels, even as prices have risen.

Still, economists expect demand may start to decline if prices remain above $5 a barrel for a sustained period.

“The $5 level is where we could see very heavy amounts of gasoline demand destruction,” said Reid L’Anson, senior economist at Kpler.

Adjusting for inflation, the U.S. gasoline average is still approximately 8% below June 2008 highs around $5.41 a gallon, according to U.S. Energy Department figures.

People drive along the Governor Alfred E. Driscoll Bridge at the start of the Memorial Day weekend, under rising gas prices and record inflation, in Keasbey, New Jersey, U.S., May 27, 2022. REUTERS/Eduardo Munoz/File Photo

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Consumer spending has so far remained resilient even with inflation running at its highest level in more than four decades, with household balance sheets shored up by pandemic relief programs and a tight job market that has fueled strong wage gains, especially for lower-income workers.

Gasoline product supplied, a proxy for demand, was 9.2 million barrels per day last week, according to the U.S. Energy Information Administration, broadly in line with five-year seasonal averages.

The high prices for drivers come as major oil-and-gas companies post bumper profits. Shell reported a record quarter in May and Chevron Corp and BP have posted their best numbers in a decade. read more

Other majors, including Exxon Mobil and TotalEnergies, as well as U.S. independent shale operators, reported strong figures that have spurred share repurchases and dividend investments. read more

Numerous companies have said they will avoid excessive investment to boost output due to investors’ desires to hold the line on spending, rather than respond to $100-plus barrel prices that have persisted for months. read more

Refiners have been struggling to rebuild inventories which have dwindled, especially on the U.S. East Coast, reflecting exports to Europe where buyers are weaning themselves off of Russian oil.

Currently, refiners are utilizing about 94% of their capacity, but overall U.S. refining capacity has fallen, with at least five oil-processing plants shutting during the pandemic.

That has left the United States structurally short of refining capacity for the first time in decades, analysts said.

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Reporting by Laura Sanicola and Shivani Tanna; editing by David Clarke and Jason Neely

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Business

Freeport LNG plant to shut for 3 weeks, roiling global energy markets

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HOUSTON, June 8 (Reuters) – Freeport LNG, operator of one of the largest U.S. export plants producing liquefied natural gas (LNG), will shut for at least three weeks following an explosion at its Texas Gulf Coast facility.

The fire roiled U.S. natural gas markets on Wednesday and the impact is likely to spread through Europe and Asia markets, analysts said.

Freeport LNG, which provides around 20% of U.S. LNG processing, disclosed the shutdown late on Wednesday after appraising damage to the massive facility.

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Its closure takes away a major supplier to markets already strained by European buyers shunning Russian LNG over its invasion of Ukraine – actions that Moscow calls a “special operation” – and by resurgent demand in China, analysts said.

“This is a significant production outage at a major U.S facility,” said Alex Munton, director of global gas and LNG at research firm Rapidan Energy. Freeport LNG ships about four cargoes per week and a three-week shutdown will take at least 1 million tonnes of LNG off the market, he said.

“It’s going to mean one thing: shortages. The competition for spot LNG is going to drive global LNG prices higher,” Munton said.

The plant can process up to 2.1 billion cubic feet of natural gas per day (bcfd), and at full capacity can export 15 million tonnes per annum (MTPA) of the liquid gas. U.S. LNG exports hit a record 9.7 bcfd last year, according to the U.S. Energy Information Administration (EIA).

In March, 21 cargoes loaded at the Freeport facility, carrying an estimated 64 billion cubic feet of gas to destinations in Europe, South Korea and China, according to the U.S. Department of Energy. That’s up from 15 cargoes in February and 19 in January.

U.S. natural gas futures sank following news of the explosion on concerns it could disrupt the plant’s demand for gas. They closed down about 6% at $8.699 per million British thermal units (mmBtu), having hit a near 14-year high of $9.664 mmBtu earlier in the day.

Freeport LNG was founded in 2002 by billionaire Michael Smith, and processes gas for companies including BP (BP.L), JERA, Kansai Electric (9503.T), Osaka Gas (9532.T), SK E&S and TotalEnergies . It is in the midst of expanding the plant’s capacity to 20 MTPA.

An investigation into what prompted the explosion was underway, a spokesperson for the company said, without elaborating on the cause of the fire.

A representative for the U.S. Coast Guard on Wednesday said a security zone had been set up two miles east and west of Freeport LNG’s facility, closing that portion of the intracoastal waterway to vessel traffic.

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Reporting by Liz Hampton in Denver, Sabrina Valle in Houston and Scott DiSavino in New York; Editing by Marguerita Choy, Richard Pullin, Chris Reese and Kenneth Maxwell

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Business

Exclusive: China’s oil champion prepares Western retreat over sanctions fear

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Men wearing face masks walk past a sign of China National Offshore Oil Corp (CNOOC) outside its headquarters in Beijing, China March 8, 2021. REUTERS/Tingshu Wang

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  • CNOOC preparing to exit Britain, Canada, U.S. -sources
  • Beijing concerned over growing tension with West
  • Production in three countries reached 220,000 boed last year
  • Decision follows CNOOC’s delisting on New York Stock Exchange

LONDON/SINGAPORE, April 13 (Reuters) – China’s top offshore oil and gas producer CNOOC Ltd. (0883.HK) is preparing to exit its operations in Britain, Canada and the United States, because of concerns in Beijing the assets could become subject to Western sanctions, industry sources said.

Ties between China and the West have long been strained by trade and human rights issues and the tension has grown following Russia’s invasion of Ukraine, which China has refused to condemn.

The United States said last week China could face consequences if it helped Russia to evade Western sanctions that have included financial measures that restrict Russia’s access to foreign currency and make it complicated to process international payments. read more

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CNOOC did not immediately comment.

Companies periodically carry out reviews of their portfolios, but the exit being prepared would take place less than a decade after state-owned CNOOC entered the three countries via a $15 billion acquisition of Canada’s Nexen, a deal that transformed the Chinese champion into a leading global producer.

The assets, which include stakes in major fields in the North Sea, the Gulf of Mexico and large Canadian oil sand projects, produce around 220,000 barrels of oil equivalent per day (boed), Reuters calculations found.

Last month, Reuters reported CNOOC had hired Bank of America to prepare for the sale of its North Sea assets, which include a stake in one of the basin’s largest fields. read more

CNOOC has launched a global portfolio review ahead of its planned public listing in the Shanghai stock exchange later this month that is aimed primarily at tapping alternative funding following the delisting of its U.S. shares last October, the sources said. read more

The delisting was part of a move by former U.S. President Donald Trump’s administration in 2020 that targeted several Chinese companies Washington said were owned or controlled by the Chinese military. China condemned the move.

CNOOC is also taking advantage of a rally in oil and gas prices, driven by Russia’s invasion of Ukraine on Feb. 24, and hopes to attract buyers as Western countries seek to develop domestic production to substitute Russian energy.

As it seeks to leave the West, CNOOC is looking to acquire new assets in Latin America and Africa, and also wants to prioritise the development of large, new prospects in Brazil, Guyana and Uganda, the sources said.

‘A PAIN’

CNOOC is seeking to sell “marginal and hard to manage” assets in Britain, Canada and the United States, a senior industry source told Reuters.

All the sources spoke on condition of anonymity because of the sensitivity of the issue.

The industry source said last month that CNOOC’s top management, including chairman Wang Dongjin, found managing the former Nexen assets was “uncomfortable” because of red tape and high operating costs compared with developing nations.

CNOOC has faced hurdles operating in the United States in particular, such as security clearances required by Washington for its Chinese executives to enter the country, the source added.

“Assets like Gulf of Mexico deepwater are technologically challenging and CNOOC really needed to work with partners to learn, but company executives were not even allowed to visit the U.S. offices. It had been a pain all along these years and the Trump administration’s blacklisting of CNOOC made it worse,” said the source.

In its prospectus ahead of the initial public offering, CNOOC said it could face additional sanctions.

“We cannot predict if the company or its affiliates and partners will be affected by U.S. sanctions in future, if policies change,” CNOOC said.

In the United States, CNOOC owns assets in the onshore Eagle Ford and Rockies shale basins as well as stakes in two large offshore fields in the Gulf of Mexico, Appomattox and Stampede.

Its main Canadian assets oil sands projects are Long Lake and Hangingstone in Alberta Province.

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Reporting by Ron Bousso and Chen Aizhu; editing by Barbara Lewis

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Business

U.S. lawmakers slam Big Oil for high gasoline prices

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Gasoline drips out of a nozzle held by a gas station mechanic in Somerville, Massachusetts, U.S., March 7, 2022. REUTERS/Brian Snyder/File Photo

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WASHINGTON, April 6 (Reuters) – Oil executives defended themselves in the U.S. Congress on Wednesday from charges by lawmakers that they are gouging Americans with high fuel prices, saying that they are boosting energy output and no one company sets the price of gasoline.

Lawmakers in the U.S. House of Representatives Energy and Commerce Subcommittee on Oversight and Investigations held the hearing to grill companies on why gasoline prices remain elevated even though prices for crude oil, the feedstock for fuels, have dropped.

U.S. gasoline prices have surged since Russia’s invasion of Ukraine in February and after Western countries slapped sanctions on Moscow’s energy exports. Pump prices hit a record, before inflation adjustments, of $4.33 a gallon on March 11, and since then have slipped about 4% to $4.16 a gallon on Wednesday, according to the AAA motorist group.

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In the same time frame, U.S. gasoline futures have fallen more than 7% to $3.07 a gallon as international crude prices have dropped more steeply,about 8%,to about $103.70 a barrel.

“One of the things that has confused me … and it’s making people mad, is why are gas prices still high?” said U.S. Representative Diana DeGette, a Democrat and chair of the subcommittee. “These prices are constraining our constituents’ budgets and patience.”

Retail gasoline prices exceed wholesale costs due to refining, transport, marketing and taxes, and the gap between the two tends to fluctuate – with retail prices often falling more slowly.

Executives from Exxon Mobil Corp (XOM.N), Chevron Corp (XOM.N), BP America (BP.L), Shell USA , Devon Energy Corp (DVN.N) and Pioneer Natural Resources Co (PXD.N) testified virtually, despite DeGette’s invitations to do so in person.

Chevron’s Chief Executive Mike Wirth said fuel prices are set by market dynamics that companies have little control over.

“Changes in the price of crude oil do not always result in immediate changes at the pump,” Wirth said, adding that “it frequently takes more time for competition among retail stations to bring prices back down at the pump.”

U.S. President Joe Biden has been struggling to tackle rising consumer prices at the pumps and at grocery stores, a vulnerability for his fellow Democrats as they seek to maintain razor-thin majorities in both chambers of Congress in the Nov. 8 elections.

The Biden administration’s sanctions on Moscow include a U.S. ban on Russian energy imports and the president has said the higher fuel prices result partially from Russia’s invasion.

Biden last week urged oil companies to boost output and service American families instead of investors, as he announced a record release of crude oil from strategic reserves. read more

Republicans, including U.S. Representative Morgan Griffith, blamed for high pump prices on Biden’s policies, including a decision to revoke a key permit for the Keystone XL pipeline that would have imported crude from Canada.

“It is impossible to generate confidence or invest in production today when future production is clearly being blocked by this administration,” Griffith said. Democrats have said oil companies are sitting on thousands of leases to drill on public lands.

DeGette questioned the billions of dollars in profits earned by the companies, and cited $30 billion in taxpayer subsidies they receive as a reason they should help lower gasoline prices.

Wirth restated Chevron’s plans to boost capital expenditure this year by 50%, with about half going to increasing oil and gas output and half to renewable fuels and lower-carbon energy.

Gretchen Watkins, president of Shell USA, said her company neither controls or owns the 13,000 gas stations that carry its brand. “Each of these independent businesses is responsible for setting the local retail price of gasoline.”

Exxon, the top U.S. oil company, on Monday said first-quarter results could top a seven-year quarterly record. Other oil company earnings could also surge after Russia’s invasion pushed up energy prices. read more

“No single company sets the price of oil or gasoline,” said Darren Woods, chairman and CEO of Exxon. “The market establishes the price based on available supply, and the demand for that supply.”

Pioneer CEO Scott Sheffield said it would take time to rev up the company’s production in the Permian Basin, citing worker and supply chain shortages and the decommissioning of many rigs and hydraulic fracturing fleets when prices were low in 2020.

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Reporting by Timothy Gardner, David Shepardson in Washington, Liz Hampton in Denver and Sabrina Valle in Houston; editing by Richard Pullin, Jonathan Oatis, David Gregorio and Marguerita Choy

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Business

China’s Sinopec plans its biggest capital expenditure in history

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A pumpjack is seen at the Sinopec-operated Shengli oil field in Dongying, Shandong province, China January 12, 2017. Picture taken January 12, 2017. REUTERS/Chen Aizhu/File Photo

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BEIJING, March 27 (Reuters) – China Petroleum & Chemical Corp (600028.SS), better known as Sinopec, is planning its highest capital investment in history for 2022 after recording its best profit in a decade, echoing Beijing’s call for energy companies to raise production.

Sinopec expects to spend 198 billion yuan ($31.10 billion) in 2022, up 18% from a year ago, beating the previous record of 181.7 billion yuan set in 2013, according to a company statement filed to the Shanghai Stocks Exchange on Sunday.

It plans to invest 81.5 billion yuan in upstream exploitation, especially the crude oil bases in Shunbei and Tahe fields, and natural gas fields in Sichuan province and the Inner Mongolia region.

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“Looking ahead in 2022, the market demand for refined oil will continued to recover, and demand for natural gas and petrochemical products will keep growing,” Sinopec said in the statement.

It also warned of potential impacts of geopolitical challenges and volatile oil prices on the investment and operation at overseas businesses. But the firm did not name any specific project.

Reuters reported that Sinopec Group had suspended talks for a major petrochemical investment and a gas marketing venture in Russia, heeding a government call for caution as sanctions mount over the invasion of Ukraine. read more

Brent oil prices have gained 52% so far this year and hit as high as $139 a barrel in early March, stoked by fears of supply disruption in the wake of Russia’s invasion of Ukraine.

Sinopec recorded its biggest profit in a decade in 2021 on the back of recovering energy demand and oil price increases in the post-COVID era, with net earnings reaching 71.21 billion yuan.

It plans to produce 281.2 million barrels of crude oil and 12,567 billion cubic feet of natural gas in 2022, up from its output of 279.76 million barrels and 1,199 billion cubic feet in 2021.

Beijing seeks to ensure energy safety in the country amid intensifying geopolitical risks. It wants to keep annual crude oil output at 200 million tonnes and crank up natural gas production to more than 230 billion cubic metres (bcm) by 2025 from 205 bcm in 2021. read more

Crude throughput and production of refined oil products at Sinopec are expected to stay around the same level in 2022 from a year ago, at 258 million tonnes and 147 million tonnes, respectively.

But demand for gasoline and diesel are dented in China as more than 2,000 of daily COVID cases have triggered local authorities to impose stringent travel restrictions while manufacturers suspended operations amid supply chain clogs. read more

($1 = 6.3658 Chinese yuan renminbi)

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Reporting by Muyu Xu and Chen Aizhu. Editing by Gerry Doyle

Our Standards: The Thomson Reuters Trust Principles.

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Halliburton, Schlumberger draw back from Russia amid U.S. energy sanctions

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Halliburton’s booth is seen at the World Petroleum Congress, in Houston, Texas, U.S. December 6, 2021. REUTERS/Sabrina Valle

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March 18 (Reuters) – U.S. oilfield services companies Halliburton Co (HAL.N)and Schlumberger said on Friday they havesuspended or halted Russia operations in response to U.S. sanctions over Moscow’s invasion of Ukraine.

The disclosures followed widespread departures by energy, retail and consumer goods businesses and a series of European Union and U.S. bans on providing oil technology to Russia or importing its energy products.

Halliburton said it immediately suspended future business and would wind down its operations in Russia after earlier ending shipments of sanctioned parts and products to the country.

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Schlumberger has ceased new investment and technology deployment while continuing with existing activity in compliance with international laws and sanctions, the company said in a statement late on Friday.

“We urge a cessation of the conflict and a restoration of safety and security in the region,” Schlumberger Chief Executive Olivier Le Peuch said.

Oilfield services provider Baker Hughes declined to comment on its Russia operations. ​

Energy companies BP PLC , Shell , Equinor ASA (EQNR.OL)and Exxon Mobil have suspended business or announced plans to exit their Russia operations.

Russia, which calls its invasion of Ukraine a “special military operation”, is among the world’s largest oil and gas producers and exports 7 million to 8 million barrels per day of crude and oil products.

Its energy operations rely largely on home-grown service providers.

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Reporting by Chavi Mehta in Bengaluru, additional reporting by Gary McWilliams and Liz Hampton; Editing by Arun Koyyur

Our Standards: The Thomson Reuters Trust Principles.

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