Bollywood Fever: Equinor, the Norwegian oil and gas producer, reported a 4% decline in second-quarter profits compared to the same period last year, citing falling natural gas prices. Despite this, the company’s results surpassed analysts’ expectations. For the April-June period, Equinor’s adjusted earnings before tax fell to $7.48 billion from $7.80 billion a year earlier, beating the $6.96 billion forecasted by a poll of 22 analysts compiled by Equinor.
“Our operational performance continued to be strong through the quarter,” CEO Anders Opedal stated. The company attributed the decrease in realized European piped gas prices to mild temperatures, high storage levels, and reduced demand. The Dutch TTF front-month gas contract, Europe’s benchmark, averaged 31.76 euros per megawatt hour (MWh) ($10.02 per mmbtu) in the second quarter, down from 34.86 euros/MWh ($11.13 per mmbtu) a year earlier.
Equinor also announced a revised growth forecast for its renewable energy production, lowering it to 70% for 2024, down from a previously expected doubling. This adjustment is due to a delay in the start-up of the 1.2 GW Dogger Bank A offshore wind farm in the UK, now expected to commence in 2025 instead of late 2024.
The company maintained its projection that oil and gas output would remain unchanged in 2024 compared to 2023 and upheld its forecast for capital expenditure at $13 billion for this year. In the second quarter, Equinor produced 2.05 million barrels of oil equivalent per day (mboed), slightly above the analyst poll’s expectation of 2.03 mboed and up from 1.99 mboed a year ago.
In 2022, Equinor surpassed Russia’s Gazprom to become Europe’s largest supplier of natural gas, following the disruption of energy ties due to Moscow’s invasion of Ukraine. However, Equinor’s share price has declined by 10.4% this year, underperforming a 1% rise in the broader index of major European energy stocks.
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