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Equinor (EQNR) Stops Russia Crude Trading Amid Ukraine Conflict
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Equinor ASA (EQNR - Free Report) has stopped trading Russian crude to withdraw its operations in response to the country’s military campaign in Ukraine, per a report by Reuters.
Equinor has been contributing to Russia’s growth for more than three decades. At 2021-end, the company had $1.2 billion in non-current assets in the country.
Russia is the third-largest oil producer and the biggest exporter of gas in the world. Over the last decade, the country was regarded as the most promising exploration and development destination globally. The country exports 4-5 million barrels of crude per day, making it the second-largest exporter of crude globally after Saudi Arabia.
However, Russia’s invasion of Ukraine has had widespread repercussions in the energy sector. Equinor joins other oil and gas traders in its decision to stop purchasing oil from Russia, which supplies about a third of Europe's oil.
The rising energy crisis, resulting from traders steering clear of Russia supplies, will boost Europe's transition to sustainable energy, and increase the shortage of oil and gas. The decision to end Europe's dependency on Russian energy sources will be challenging, and require substantial investments in fossil fuel and renewables.
Equinor also declared its intentions to stop new investments in Russia and start the course to withdraw from its joint ventures in the country. The company said that the decision to pull out from joint ventures would affect the book value of its Russia assets and lead to impairments.
Equinor is currently extracting oil and gas at the maximum capacity. It will postpone some planned maintenance at its North Sea asset to restore the declining gas storage in Europe.The company is actively exploring new oil and gas resources in the Norwegian North Sea, with 25-30 new wells planned this year. However, it might take years to increase production.
Equinor is exploring every possibility to keep the production level high. It is crucial to ensure that enough investments are going into oil and gas other than renewables.
Company Profile & Price Performance
Headquartered in Stavanger, Norway, Equinor is one of the leading integrated energy companies in the world.
Shares of EQNR have underperformed the industry in the past six months. The stock has gained 43.7% compared with the industry’s 44.5% growth.
RPC Inc. (RES - Free Report) is among the leading providers of advanced oilfield services, and equipment to almost all prospective oil and gas shale plays in the United States.
With no debt load, RPC had cash and cash equivalents of $82.4 million at the fourth-quarter end. This reflects its strong balance sheet, which will provide the company with massive financial flexibility. It allows RPC to remain afloat during tough times.
Chevron Corporation (CVX - Free Report) is one of the largest publicly traded oil and gas companies in the world. CVX recently raised its quarterly dividend by 6% to $1.42 per share (or $5.68 per share annualized) after increasing it in April. It also revived its stock repurchase program to buy back $2-$3 billion worth of shares.
As of Dec 31, Chevron had $5.6 billion in cash and cash equivalents, and total debt of $31.4 billion, with a debt-to-total capitalization of a modest 18.4%. CVX also carries a high investment grade rating of AA from S&P, which translates into low borrowing rates.
Petrobras (PBR - Free Report) is one of the largest publicly-traded Latin America-based oil companies, which dominates Brazil’s oil and gas sector. PBR produces most of Brazil’s crude oil and natural gas. It accounts for almost the entire refining capacity of the country.
Petrobras, burdened with a huge debt load, laid strong emphasis on its debt reduction in its recent five-year business management plan (2022-2026) to strengthen its credit rating. As the company focuses on regaining its financial footing by selling assets and curtailing debt load, it has successfully managed to lower gross debt below its 2022 target of $60 billion in the third quarter of 2021, well ahead of time.
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Equinor (EQNR) Stops Russia Crude Trading Amid Ukraine Conflict
Equinor ASA (EQNR - Free Report) has stopped trading Russian crude to withdraw its operations in response to the country’s military campaign in Ukraine, per a report by Reuters.
Equinor has been contributing to Russia’s growth for more than three decades. At 2021-end, the company had $1.2 billion in non-current assets in the country.
Russia is the third-largest oil producer and the biggest exporter of gas in the world. Over the last decade, the country was regarded as the most promising exploration and development destination globally. The country exports 4-5 million barrels of crude per day, making it the second-largest exporter of crude globally after Saudi Arabia.
However, Russia’s invasion of Ukraine has had widespread repercussions in the energy sector. Equinor joins other oil and gas traders in its decision to stop purchasing oil from Russia, which supplies about a third of Europe's oil.
The rising energy crisis, resulting from traders steering clear of Russia supplies, will boost Europe's transition to sustainable energy, and increase the shortage of oil and gas. The decision to end Europe's dependency on Russian energy sources will be challenging, and require substantial investments in fossil fuel and renewables.
Equinor also declared its intentions to stop new investments in Russia and start the course to withdraw from its joint ventures in the country. The company said that the decision to pull out from joint ventures would affect the book value of its Russia assets and lead to impairments.
Equinor is currently extracting oil and gas at the maximum capacity. It will postpone some planned maintenance at its North Sea asset to restore the declining gas storage in Europe.The company is actively exploring new oil and gas resources in the Norwegian North Sea, with 25-30 new wells planned this year. However, it might take years to increase production.
Equinor is exploring every possibility to keep the production level high. It is crucial to ensure that enough investments are going into oil and gas other than renewables.
Company Profile & Price Performance
Headquartered in Stavanger, Norway, Equinor is one of the leading integrated energy companies in the world.
Shares of EQNR have underperformed the industry in the past six months. The stock has gained 43.7% compared with the industry’s 44.5% growth.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Equinor currently carries a Zack Rank #3 (Hold).
Investors interested in the energy sector might look at the following companies that presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
RPC Inc. (RES - Free Report) is among the leading providers of advanced oilfield services, and equipment to almost all prospective oil and gas shale plays in the United States.
With no debt load, RPC had cash and cash equivalents of $82.4 million at the fourth-quarter end. This reflects its strong balance sheet, which will provide the company with massive financial flexibility. It allows RPC to remain afloat during tough times.
Chevron Corporation (CVX - Free Report) is one of the largest publicly traded oil and gas companies in the world. CVX recently raised its quarterly dividend by 6% to $1.42 per share (or $5.68 per share annualized) after increasing it in April. It also revived its stock repurchase program to buy back $2-$3 billion worth of shares.
As of Dec 31, Chevron had $5.6 billion in cash and cash equivalents, and total debt of $31.4 billion, with a debt-to-total capitalization of a modest 18.4%. CVX also carries a high investment grade rating of AA from S&P, which translates into low borrowing rates.
Petrobras (PBR - Free Report) is one of the largest publicly-traded Latin America-based oil companies, which dominates Brazil’s oil and gas sector. PBR produces most of Brazil’s crude oil and natural gas. It accounts for almost the entire refining capacity of the country.
Petrobras, burdened with a huge debt load, laid strong emphasis on its debt reduction in its recent five-year business management plan (2022-2026) to strengthen its credit rating. As the company focuses on regaining its financial footing by selling assets and curtailing debt load, it has successfully managed to lower gross debt below its 2022 target of $60 billion in the third quarter of 2021, well ahead of time.