Communicator

Oil Majors Market Capitalization. By: Aniekpong D. Effiong. Data source: CompaniesMarketCap.

By Portfolio Planning PLUS, 6^th May 2025

BP, the British energy giant, has become a focal point of merger speculation as rivals Shell and Abu Dhabi’s ADNOC weigh strategic moves to acquire the company. The developments highlight BP’s vulnerability amid lagging stock performance and shifting energy priorities, with potential bids reflecting divergent visions for the future of the oil sector.

Shell’s Calculated Interest

Shell is actively evaluating a takeover of BP, according to Bloomberg and Reuters sources, with advisers assessing regulatory, financial, and operational implications. The rationale centers on BP’s discounted valuation-its shares have fallen nearly 30% over 12 months-and the strategic appeal of combining Shell’s $197 billion market cap with BP’s assets to rival U.S. giants ExxonMobil and Chevron.

A merger would create a $320 billion behemoth, dominate LNG and deepwater drilling portfolios, and unlock an estimated $5–7 billion in annual synergies. However, Shell CEO Wael Sawan has emphasized caution, telling the Financial Times that share buybacks and smaller acquisitions remain priorities. Regulatory scrutiny in the EU and U.S., particularly over overlapping downstream assets, could also complicate a deal.

ADNOC’s Earlier Overtures

ADNOC, the UAE’s state-owned energy leader, previously explored acquiring BP in 2024 but abandoned the idea after deeming the company a poor strategic fit. Sources cited BP’s renewable energy pivot and political sensitivities as key deterrents. Instead, ADNOC has focused on gas and chemical ventures, including a $3.6 billion Fertiglobe acquisition and a joint venture with BP in Egypt.

The UAE giant’s decision underscores BP’s challenging position: criticized by investors for its energy transition strategy yet still seen as insufficiently green by some state-backed players. ADNOC’s pivot toward partnerships rather than outright acquisitions suggests BP’s mixed appeal in a sector prioritizing either scale or decarbonization.

BP’s Crossroads

BP’s struggles are multifaceted. Its market capitalization of $110 billion trails Shell’s by nearly half, and its revised transition plan-scaling back renewables investment to focus on oil and gas-has yet to reassure markets. Activist investor Elliott Management acquired a 5% stake in late 2024, intensifying pressure to improve returns.

CEO Murray Auchincloss, who took the helm in 2024, has pledged $20 billion in asset sales by 2027 to streamline operations. However, these efforts have done little to lift its stock, leaving BP exposed to takeover interest.

Industry Implications

A Shell-BP merger would accelerate consolidation among European majors, mirroring U.S. deals like Exxon-Pioneer and Chevron-Hess. For ADNOC, BP’s appeal lies in LNG and trading capabilities, but its renewables portfolio clashes with the UAE’s oil-focused growth strategy.

Analysts note that BP’s future hinges on whether it can stabilize operations independently or becomes a target for firms seeking to bolster reserves and market share. “BP is caught between competing visions: too green for some, not green enough for others,” said energy strategist Kathleen Brooks. “That paradox makes it a compelling but risky target.”

What’s Next?

Shell’s next steps depend on BP’s stock trajectory and oil price stability. ADNOC, while out of the running for now, could re-engage if geopolitical or market conditions shift. For BP, the path forward involves either executing its turnaround plan or succumbing to the pressures of an industry increasingly defined by scale.

As the energy transition reshapes priorities, BP’s fate may well determine whether European majors can compete globally-or become acquisition targets themselves.

#energytransition  #renewableenergy  #oilmajors  #oilandgas  #shell  #adnoc  #bp  #exxonmobil  #chevron  #fertiglobe  #lng  #naturalgas  #crudeoil  #merger  #acquisition 

Siemens Energy has been added.

#siemens #energy  #siemensenergy 

Vitol's ATB Terminal in Malaysia.

In a recent report, Vitol, the world's largest independent oil trader, has projected that global oil demand will remain at current levels until at least 2040. This forecast challenges earlier predictions of a peak in oil demand followed by a sharp decline due to the rise of electric vehicles and renewable energy sources.

Vitol's analysis suggests that while demand for oil in developed nations may decrease, this will be offset by rising demand in developing economies. The company cites population growth, economic expansion, and urbanization as key factors driving this continued demand.

The report also highlights the role of the petrochemicals industry, which is expected to see increased oil demand for the production of plastics and other materials. This growth, coupled with demand from developing nations, is anticipated to keep global oil consumption steady.

While acknowledging the global push for cleaner energy, Vitol's forecast indicates that oil will continue to play a significant role in the global energy mix for the foreseeable future. The company's analysis underscores the complex challenges of balancing economic development with the transition to a more sustainable energy future.

China: Vitol's global head of research, Giovanni Serio, has highlighted that China will continue to play a critical role in global oil demand, particularly in the petrochemical sector. Despite the rise of electric vehicles and the energy transition, China's focus on petrochemicals is expected to drive oil demand.

Long-Term Forecast: Vitol has pushed back its peak oil demand forecast globally to the 2030s, citing a slower uptake of electric vehicles and lower commitments to environmental targets. The company also anticipates that jet fuel and petrochemical feedstocks will drive global oil demand growth in the next five years.

These insights reflect Vitol's evolving views on the future of oil demand, emphasizing the role of emerging markets and the ongoing energy transition.

#vitol  #energy  #energytrannsition  #oildemand  #crudeoil  #petrochemicals 

25^th Nov 2024, SINA, Reprinted from East China Science and Technology (ECEC).

Recently, the DMC recovery project of Guangxi Huayi Energy Chemical Co., Ltd. was successfully started up and produced qualified high-grade DMC (dimethyl carbonate) products. This marks the complete success of the project from design, construction to production.

Located at Qinzhou Port Economic and Technological Development Zone, The DMC recovery project is an important supporting project for the 200,000 tons/year ethylene glycol unit of Guangxi Energy Chemical Co., Ltd., consisting in constructing a DMC recovery unit to distill and purify DMC and methanol, with an output of 16,800 tons of premium dimethyl carbonate annually, and also recovering 23,256 tons of high-purity methanol annually, significantly improving resource utilization efficiency and promoting the development of the circular economy in the park.


#dmc  #dimethylcarbonate  #methanol  #huayi  #energychemical  #guangxi  #china 

Bluestar (Beijing) Chemical Machinery Co., Ltd., a producer of electrolysis technology and a special equipment manufacturing technology, has been added.

The company has developed three core products:

1. Complete electrolysis equipment.
2. Solar thermal energy storage products.
3. Biomass resource utilization equipment.

Bluestar Beihuaji is the only domestic supplier of complete chlor-alkali equipment that integrates basic design, detailed design, core equipment manufacturing, and installation services. It is one of the four major global suppliers of ion membrane electrolyzers, with an annual production capacity of 1 million tons of caustic soda equipment and 3 million tons of electrodes. The company provides ion membrane electrolysis equipment with an annual capacity exceeding 18 million tons of caustic soda to more than 140 chlor-alkali producers worldwide, with business covering 18 countries across Europe, Asia, America, and Africa.

Thanks to increasing international and domestic market demand for new energy, Beihuaji's solar thermal power storage products have gradually become a leading domestic supplier of solar thermal energy storage products after years of development and market promotion, participating in multiple domestic and international solar thermal projects.

#solarenergy  #energystorage  #chloralkali #caustic  #electrolyis  #china  #beijing  #bluestar  #sinochem #bluestar  #chemchina 

African Energy Week 2024 presents the vision of a diversified energy future

AFRICAN ENERGY WEEK: OIL & GAS DEMAND EXPECTED TO REMAIN STRONG THROUGH 2050

Global demand for oil and gas is expected to remain strong in the coming decades, according to Haitham al-Ghais, Secretary-General of the Organization of the Petroleum Exporting Countries (OPEC). Speaking at the  Africa Energy Week (AEW) in Cape Town,  South Africa, on 6 November, Haitham al-Ghais explained that this increase in energy demand would be driven by global population growth and a doubling of global GDP by 2050. “OPEC sees the outlook for global oil and gas consumption as very positive. By 2050, energy demand will increase by 24%,” he said.

The world population, currently 8 billion, is expected to reach 9.7 billion by 2050, with a significant share of this growth concentrated in developing countries, particularly in Africa. Al-Ghais stressed that this population increase and the economic growth of emerging megacities and cities of several million inhabitants would amplify the demand for energy, requiring the mobilization of all available resources, including fossil fuels.

The leading role of oil and gas

According to OPEC projections, oil and natural gas will still account for 55% of global energy supply in 2050, with oil alone accounting for 30% of this share. “The world will need all kinds of energy resources in the coming decades,” the OPEC Secretary General said, adding that renewables, although growing, will not be enough to meet this increased demand. In order to meet the growing needs and stabilize markets, OPEC estimates that massive investments will be needed in the oil sector. “Until 2050, the oil sector will require investments of $17.4 trillion,” al-Ghais said, adding that this funding will be mainly directed towards production programs to ensure stable supplies and prevent sudden fluctuations in fuel prices.

A strategic event for the sector

The African Energy Week, which brings together over 1,000 participants, including officials from 22 African countries, industrialists, business people and analysts, continues until November 8. The event provides a platform to discuss energy challenges in Africa and how the continent can meet the growing global energy needs.

Source

#oilandgas #crudeoil #naturalgas #africa #refining #refinery #oildemand #energy #fossilfuels #fuelprices #oilsector

A division of Alphabet Inc. has claimed carbon neutrality in its operations since 2007. This status was achieved by purchasing carbon offsets to match the emissions produced by its buildings, data centers, and business travel.

However, in its latest report, the company states:
"Starting in 2023, we no longer support operational carbon neutrality."

Google has ceased its substantial purchase of inexpensive carbon offsets. This strategic shift coincided with Google and Big Tech's dramatic move towards artificial intelligence technology, which is extremely resource-intensive.

As a result, energy consumption in 2023 was 48% higher than in 2019. Total energy consumption doubled over that period.

Microsoft shares a similar story. The company's AI activities led to a 30% increase in emissions compared to 2020, although it still aims to become carbon-negative by 2030.

#microsoft  #google  #alphabet  #ai  #artificialintelligence  #energyconsumption  #carboncredits  #carbonneutrality  #carbonoffsets  #emissions  #CO2  #carbondioxide  #carbonnegative