On Monday, Shell said the margin earned for processing crude sank by 29% in the period. Its chemicals division — also a bellwether for the strength of the wider economy — expects to report a “marginal loss.” Strong gas production was one of a few bright spots.
BP followed on Friday with another warning flag: an increase in its net debt. This core metric has fallen in recent years — from $40 billion in 2020 to about $23 billion at the end of the second quarter — as high energy prices boosted profits.
Now, feeble refining income has halted the downward trend, while a change in the timing of asset-sale payments was also a factor.
These aren’t just issues for the European majors. On Oct. 3, Exxon Mobil Corp. said lower crude prices and poor refining margins would reduce earnings by $1.6 billion quarter-on-quarter.
Profits from processing are closely tied to demand for road fuels, so the decline indicates broad weakness in the global economy — notably in China, but also in the US and Europe.
Sunny ways, sunny ways!
Well … Brian Zinchuk has a simple answer for this … RAISE OIL PRICES NOW!! And for the love of God … do NOT elect anyone like Donald Trump who stupidly shouts “drill baby drill”. No, Brian insists we need $100/bbl oil prices again!! It’s for your (his) own good.
Meh
BP and Shell are two of the most progressive DEI “Must Address Climate Change” companies out there.
The economy is weak, but not because of oil prices. Electricity is another matter. Companies are getting strangled.
And that lowers government revenue, so maybe not a bad thing?