The first two quarters of the current year have been brutal for U.S. oil and fuel companies.According to Refintiv’s knowledge, the energy sector recorded the lowest rate of profit expansion in the 2020 quarter (-168.5%) of any U.S. industry, with profits of -10.5 billion.compared to $15.3 billion in last year’s comparable quarter.
This is much worse than the average expansion rate of S earnings
But the US shale manufacturers have been in the process of But it’s not the first time You can be sure that your competitors haven’t done much better.
The oil and fuel giants, Saudi Arabia and China, have also recorded losses, demonstrating that Covid-19 is an equivalent opportunity pandemic.
Saudi Aramco’s net revenue source (ARMCO) fell 73% to 24.6 billion riyals ($6.57 billion) in the current quarter, compared to estimates of 31.3 billion riyals, but unlike BP Plc.(NYSE: BP) and Royal Dutch Shell (NYSE: RDS. A), which has reduced its dividends in recent months, the majority public company has maintained its T2 dividend of $18.75 billion.Aramco plans to reduce investment in 2020 to a diversity of $20 billion to $25 billion in 2020 to pay the $75 billion dividend it promised investors when it went public.
China, the world’s largest importer of oil, imports less from Saudi Arabia as U.S. imports increase, in an effort to meet its obligations under the January industry agreement.
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However, China is about to maintain its market share: last month, we reported that Chinese imports of U.S. energy products, adding crude oil, liquefied herbal fuel (LNG) and metallurgical coal, reached just $1.29 billion in June, or only 5% of the $25.3 million energy target.
Perhaps Beijing is in a Biden presidency fulfilling its preference to bring U.S.-China relations back to the Obama era.
China’s own oil corporations are equally bad.Like The “big four” Chinese banks, the oil giants saw their profits fall in the first half, and this is unusual.
PetroChina (NYSE: PTR), Asia’s largest oil and fuel manufacturer and China’s second-largest refinery, reported a net loss in the first half of 29.980 million yuan ($4.36 billion) compared to a first-half profit of 28.420 million yuan ($4.13 billion).) .revenue fell 22% to 929 billion yuan ($135.1 billion).This despite the increase of crude oil production by 5.2% to 475.4 million barrels, while herbal fuel production increased by 9.4% to 2.15 trillion cubic feet thanks to the giant state property that supports domestic drilling in an effort to protect the security of household supply.
China has accelerated its fuel production by following an earlier promise to make greater use of low-carbon fuel.
Meanwhile, China’s largest oil refinery, Sinopec Shanghai Petrochemical Company Limited (NYSE: SHI), recorded losses of 22.88 billion yuan ($3.33 billion), in contrast to a profit of 31.34 billion yuan ($4.56 billion) over the same time last year in a slow-running demand for subtle products.
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However, Sinopec reported a net profit of 4.8 billion yuan ($700 million) at the time of the quarter thanks to the flexibilization of coronavirus restriction measures in China.
Sinopec says it expects the order for its subtle petroleum products to be even faster due to positive trends in the Chinese economy.
In fact, Aramco’s CHIEF executive, Amin Nasser, said last week: “Look to China, its demand for gasoline and diesel is almost at the pre-COVID 19 levels.We see that Asia is recovering and other markets (also).As countries ease the blockade, we expect the call to increase.”
Today, industry resources say Saudi Arabia is most probably to extra official crude oil sales costs for Asian buyers.Another relief would be the moment in two months, along with the decline in benchmarks in the Middle East and refining margins.
By Alex Kimani for OilUSD
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