First quarter oil industry results reaffirm industry instability, says GlobalData

The recently exposed instability in the oil industry makes a speedy transition to sustainable energy a necessity

Some oil companies have touted more sustainable investments and principles in recent years. Both Shell and BP aim to reach net-zero carbon emissions by 2050.
Some oil companies have touted more sustainable investments and principles in recent years. Both Shell and BP aim to reach net-zero carbon emissions by 2050.

Following the release of first quarter results from several oil and gas companies, Ella Benson Easton, thematic analyst at GlobalData, offered her view: “This year has seen extraordinary volatility in the oil and gas industry. The decline in the cost of renewable energies, an oil price war and Covid-19 have all contributed to the industry’s precarity. First quarter results have reflected the difficult situation, for example BP’s net profit dropped 67%, ConocoPhillips reported a Q1 loss of $1.7bn, and Royal Dutch Shell reduced dividends by 65%, the first cut for the company since since World War II. Sinopec recorded a $2.71bn loss despite fuel sales rebounding.

“These numbers confirm the strain the oil and gas industry is under. The real difficulty for the industry is gaining a degree of stability, particularly given the uncertainty around the full impact of the pandemic on things such as customer behaviour and investment priorities.”

“Some oil companies have touted more sustainable investments and principles in recent years. Both Shell and BP aim to reach net-zero carbon emissions by 2050. The recently exposed instability in the oil industry makes a speedy transition to sustainable energy a necessity.”

“Sustainability will remain a key theme for enterprises across industry sectors well beyond Covid-19. GlobalData’s sustainability framework shows the areas in which companies need to focus their investment to put themselves in a position to succeed. Increased investment in renewable energies and modern technologies is now vital as oil companies insulate themselves against further price shocks. Oil companies that diversify their investments and invest in the sustainability theme will be better placed to survive the long-term effects of the current crisis.”

For the latest refining and petrochemical industry related videos, subscribe to our YouTube page.

For all the latest refining and petrochemical news from the Middle East countries, follow us on Twitter and LinkedIn, like us on Facebook.

You may also like

APICORP posts $54.8mn net profit in H1-2020
Gross operating income at $144.7mn and net income at $54.8mn despite adverse global conditions
Mammoet’s heavy lifting and transport solutions for a turnaround at Saudi Aramco’s refinery
Early involvement, innovative engineering and equipment availability are key to narrow shutdown window at Riyadh refinery
Digital twins are the key to operational excellence in refineries
Digital twins are becoming commonplace in a variety of industries, including the oil and gas industry. They offer tremendous benefits to refineries, particularly in terms of asset reliability for all critical equipment types
US oil market shows right trend at a slow pace, says GlobalData
Indeed, last week’s lower supplied volumes of gasoline and lower crude demand from refiners negatively impacted WTI

MOST POPULAR