TotalEnergies Eyes Massive Profit Windfall as Refining Margins Soar
India’s Annual Wind Power Installations to Double by 2030 What I Cover Tsvetana Paraskova is an energy and commodities journalist who has contributed to Oilprice.com for nearly a decade, covering global energy markets, commodities,… TotalEnergies expects to report strong third-quarter results later this month as the Middle East conflict has driven up refining margins and LNG prices in a bull market, the French oil and gas supermajor said on Thursday.
TotalEnergies said in atrading updateits European refining margin soared to as much as $33.20 per barrel in the third quarter, nearly tripled from $13.50 for the second quarter, and quadrupled from the $8.40 refining margin in the third quarter last year.
“Downstream results and cash flow are expected to reach exceptional levels, with a very sharp increase of $2 billion for Refining & Chemicals cash flow compared to the second quarter,” TotalEnergies said, following the other European majors Shell and BP in expecting exceptional refining profits amid the global fuel supply crunch.
“The 10% refining throughput increase enabled the Company to fully capture historically high refining margins in Europe and worldwide,” TotalEnergies said.
Oil trading activities continued to outperform in the third quarter on a level consistent with the previous two quarters, the supermajor said, anticipating strong trading profits, too.
The trading profits will be further boosted by the Integrated LNG division, where results are seen rising sharply, driven by the 20% increase in the average LNG price since the second quarter and “by the outperformance of LNG and gas trading activities in a bull market, driven by the prolonged conflict in the Strait of Hormuz and expectation for strong winter demand.” TotalEnergies is reporting full third-quarter results on October 29, the same day on which Shell also reports Q3 earnings.
Shell last week said that its refining margin for the third quarter nearly doubled sequentially to hit a record high, which is set to combine with strong trading results and high oil and gas realizations to keepyielding windfall profitsfor the UK-based supermajor.
Shell expects its indicative refining margin for the third quarter to have jumped to $42 per barrel, up from $24 per barrel for the second quarter.
Norway’s Equinor alsoexpects“unusually strong European refining margins” and optimization in third-party LNG trading to boost profits for the division above the $400-million guidance.
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| Product | Price | Change |
|---|---|---|
| Brent Crude | $102.14/bbl | +0.34% |
| WTI Crude | $96.90/bbl | +0.21% |
| EN590 Diesel | $846/MT | +0.18% |
| Jet Fuel A-1 | $1090/MT | +0.55% |
| Mazut M100 | $450/MT | -0.15% |
| Bitumen 60/70 | $470/MT | +0.08% |
| Sulphur Gran 99.5% | $470/MT | -0.44% |
| Urea 46% Gran | $650/MT | +1.12% |
| NPK 16-16-16 | $460/MT | -0.28% |
| Nat Gas TTF | $15.42/MMBtu | +0.92% |
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