TotalEnergies Production Impacted by Iran War Amid Surging Oil Prices
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 3 hours ago
0mins
Should l Buy TTE?
Source: seekingalpha
- Production Disruption: Approximately 15% of TotalEnergies' (TTE) production is offline as the conflict with Iran approaches one month, yet surging oil prices above $100 per barrel have compensated for lost output, demonstrating market resilience.
- Rising Product Prices: CEO Patrick Pouyanné highlighted that while the Brent crude market remains stable, product prices are significantly higher, indicating a more pronounced impact on customers and reflecting the current market tensions.
- Record Refining Margins: Pouyanné noted that refining margins for products like Asian jet fuel have reached unprecedented levels, showcasing a substantial increase in profitability for the refining sector amid global supply chain disruptions.
- Natural Gas Price Outlook: With rising summer demand, Pouyanné anticipates that European natural gas prices could soar to $40 per million British thermal units if the conflict persists, further exacerbating market uncertainties.
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Analyst Views on TTE
Wall Street analysts forecast TTE stock price to fall
16 Analyst Rating
8 Buy
8 Hold
0 Sell
Moderate Buy
Current: 89.140
Low
60.04
Averages
71.67
High
90.93
Current: 89.140
Low
60.04
Averages
71.67
High
90.93
About TTE
TotalEnergies SE is a France-based company. The Company is predominantly engaged in the business as a worldwide oil group. Its segment divisions are divided into refining and chemistry such as refining of petroleum products and manufacture of basic chemistry and of specialty chemistry, petroleum products distribution, electricity generation from combined cycle gas plants and renewable energies, gas production, trading, transport and distribution primarily includes liquefied natural gas, natural gas, biogas, hydrogen, liquefied petroleum gas and hydrocarbon operating and production. The group is also operating in trading and sea transport of crude oil and oil products.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
TotalEnergies Exits U.S. Offshore Wind Projects to Focus on Gas Production
- Project Withdrawal: TotalEnergies has signed settlement agreements with the U.S. Interior Department to relinquish offshore wind leases in New York and North Carolina, indicating a lack of confidence in U.S. offshore wind projects, which may impact its renewable energy strategy in the U.S.
- Reinvestment of Funds: Under the deal, TotalEnergies will recover lease fees paid and reinvest an equal amount into U.S. gas and power production, demonstrating the company's focus on traditional energy sources to meet the growing electricity demand.
- Strategic Shift: The CEO stated that investments will support the construction of the Rio Grande LNG plant and the development of oil and gas activities, indicating a pivot towards more cost-effective energy solutions to bolster energy supply for both the U.S. and Europe.
- Market Impact: This move may lead to reduced investment in the U.S. offshore wind market while strengthening TotalEnergies' competitiveness in the LNG sector, which is expected to negatively affect its future financial performance.
See More
CERAWEEK: US and France's Total to Shift Almost $1 Billion from Offshore Wind Leases to US Natural Gas Production, Says Interior Secretary Doug Burgum
Total Energy Investment: France's Total has invested nearly $1 billion in offshore wind leases to boost natural gas production.
U.S. Government Involvement: The initiative is supported by U.S. Interior Secretary Doug Burgum, highlighting the government's role in renewable energy expansion.
See More
TotalEnergies Production Impacted by Iran War Amid Surging Oil Prices
- Production Disruption: Approximately 15% of TotalEnergies' (TTE) production is offline as the conflict with Iran approaches one month, yet surging oil prices above $100 per barrel have compensated for lost output, demonstrating market resilience.
- Rising Product Prices: CEO Patrick Pouyanné highlighted that while the Brent crude market remains stable, product prices are significantly higher, indicating a more pronounced impact on customers and reflecting the current market tensions.
- Record Refining Margins: Pouyanné noted that refining margins for products like Asian jet fuel have reached unprecedented levels, showcasing a substantial increase in profitability for the refining sector amid global supply chain disruptions.
- Natural Gas Price Outlook: With rising summer demand, Pouyanné anticipates that European natural gas prices could soar to $40 per million British thermal units if the conflict persists, further exacerbating market uncertainties.
See More
TotalEnergies CEO Discusses Current Oil and Gas Market Conditions
- Production Impact: TotalEnergies has approximately 15% of its production offline due to the ongoing conflict with Iran, yet the Brent crude price remains solidly above $100 per barrel, compensating for lost output and demonstrating the company's resilience in a high-price environment.
- Surging Product Prices: CEO Pouyanné highlighted that while the Brent market is stable, product prices are significantly higher, particularly refining margins for Asian jet fuel, which have reached unprecedented levels, indicating a tight supply-demand situation in the market.
- Natural Gas Price Outlook: Pouyanné anticipates that ongoing conflict will lead to substantial increases in natural gas prices during the summer, potentially reaching $40 per million British thermal units as Asian demand rises, reflecting the market's high sensitivity to energy supply.
- U.S. Investment Shift: TotalEnergies has struck a deal with the Trump administration to abandon offshore wind projects in exchange for $1 billion, planning to reinvest in U.S. oil and gas projects, indicating a strategic pivot towards more cost-effective technologies in the U.S. market.
See More
TotalEnergies Abandons Offshore Wind Projects for Fossil Fuel Investments
- Capital Reallocation: TotalEnergies has opted not to pursue costly offshore wind leases, redirecting approximately $1 billion in capital towards oil, natural gas, and LNG projects in the U.S., which will mitigate investment risks and enhance short-term profitability.
- Government Reimbursement Agreement: The U.S. government will reimburse TotalEnergies for previously acquired offshore wind leases on a dollar-for-dollar basis, indicating strong governmental support for domestic fossil fuel and LNG development aimed at bolstering national energy security.
- Investment Plans: TotalEnergies plans to invest about $928 million in 2026, focusing on the development of the Rio Grande LNG plant in Texas and expanding upstream oil and gas and shale production, which is expected to drive growth in the U.S. market.
- Project Termination: The agreement includes the termination of offshore wind leases in the Carolina Long Bay and New York Bight areas, for which TotalEnergies had paid a combined $928 million, reflecting the company's adaptation to U.S. energy policy and its strategic shift to better support national energy strategies.
See More
TotalEnergies Abandons U.S. Offshore Wind Projects
- Project Abandonment: TotalEnergies has signed settlement agreements with the U.S. Department of the Interior to relinquish its Carolina Long Bay and New York Bight leases awarded in 2022, marking a strategic shift away from offshore wind projects in the U.S.
- Funds Recovery and Reinvestment: Under the terms of the settlement, TotalEnergies will recover the lease fees paid and reinvest an equal amount into U.S. gas and power production and exports, which is expected to enhance its competitive position in the U.S. energy market.
- Market Analysis: The company's studies indicate that offshore wind developments in the U.S. are costly and could negatively impact consumer electricity prices, leading to the decision to avoid capital allocation to this technology in favor of more cost-effective energy solutions.
- Long-term Offtake Agreement: TotalEnergies has signed a Letter of Intent with Glenfarne for the long-term offtake of 2 million tons per year of liquefied natural gas over 20 years, further solidifying its leadership in the U.S. LNG market.
See More
TotalEnergies Exits U.S. Offshore Wind Projects to Focus on Gas Production
- Project Withdrawal: TotalEnergies has signed settlement agreements with the U.S. Interior Department to relinquish offshore wind leases in New York and North Carolina, indicating a lack of confidence in U.S. offshore wind projects, which may impact its renewable energy strategy in the U.S.
- Reinvestment of Funds: Under the deal, TotalEnergies will recover lease fees paid and reinvest an equal amount into U.S. gas and power production, demonstrating the company's focus on traditional energy sources to meet the growing electricity demand.
- Strategic Shift: The CEO stated that investments will support the construction of the Rio Grande LNG plant and the development of oil and gas activities, indicating a pivot towards more cost-effective energy solutions to bolster energy supply for both the U.S. and Europe.
- Market Impact: This move may lead to reduced investment in the U.S. offshore wind market while strengthening TotalEnergies' competitiveness in the LNG sector, which is expected to negatively affect its future financial performance.
See More
CERAWEEK: US and France's Total to Shift Almost $1 Billion from Offshore Wind Leases to US Natural Gas Production, Says Interior Secretary Doug Burgum
Total Energy Investment: France's Total has invested nearly $1 billion in offshore wind leases to boost natural gas production.
U.S. Government Involvement: The initiative is supported by U.S. Interior Secretary Doug Burgum, highlighting the government's role in renewable energy expansion.
See More
TotalEnergies Production Impacted by Iran War Amid Surging Oil Prices
- Production Disruption: Approximately 15% of TotalEnergies' (TTE) production is offline as the conflict with Iran approaches one month, yet surging oil prices above $100 per barrel have compensated for lost output, demonstrating market resilience.
- Rising Product Prices: CEO Patrick Pouyanné highlighted that while the Brent crude market remains stable, product prices are significantly higher, indicating a more pronounced impact on customers and reflecting the current market tensions.
- Record Refining Margins: Pouyanné noted that refining margins for products like Asian jet fuel have reached unprecedented levels, showcasing a substantial increase in profitability for the refining sector amid global supply chain disruptions.
- Natural Gas Price Outlook: With rising summer demand, Pouyanné anticipates that European natural gas prices could soar to $40 per million British thermal units if the conflict persists, further exacerbating market uncertainties.
See More
TotalEnergies CEO Discusses Current Oil and Gas Market Conditions
- Production Impact: TotalEnergies has approximately 15% of its production offline due to the ongoing conflict with Iran, yet the Brent crude price remains solidly above $100 per barrel, compensating for lost output and demonstrating the company's resilience in a high-price environment.
- Surging Product Prices: CEO Pouyanné highlighted that while the Brent market is stable, product prices are significantly higher, particularly refining margins for Asian jet fuel, which have reached unprecedented levels, indicating a tight supply-demand situation in the market.
- Natural Gas Price Outlook: Pouyanné anticipates that ongoing conflict will lead to substantial increases in natural gas prices during the summer, potentially reaching $40 per million British thermal units as Asian demand rises, reflecting the market's high sensitivity to energy supply.
- U.S. Investment Shift: TotalEnergies has struck a deal with the Trump administration to abandon offshore wind projects in exchange for $1 billion, planning to reinvest in U.S. oil and gas projects, indicating a strategic pivot towards more cost-effective technologies in the U.S. market.
See More
TotalEnergies Abandons Offshore Wind Projects for Fossil Fuel Investments
- Capital Reallocation: TotalEnergies has opted not to pursue costly offshore wind leases, redirecting approximately $1 billion in capital towards oil, natural gas, and LNG projects in the U.S., which will mitigate investment risks and enhance short-term profitability.
- Government Reimbursement Agreement: The U.S. government will reimburse TotalEnergies for previously acquired offshore wind leases on a dollar-for-dollar basis, indicating strong governmental support for domestic fossil fuel and LNG development aimed at bolstering national energy security.
- Investment Plans: TotalEnergies plans to invest about $928 million in 2026, focusing on the development of the Rio Grande LNG plant in Texas and expanding upstream oil and gas and shale production, which is expected to drive growth in the U.S. market.
- Project Termination: The agreement includes the termination of offshore wind leases in the Carolina Long Bay and New York Bight areas, for which TotalEnergies had paid a combined $928 million, reflecting the company's adaptation to U.S. energy policy and its strategic shift to better support national energy strategies.
See More
TotalEnergies Abandons U.S. Offshore Wind Projects
- Project Abandonment: TotalEnergies has signed settlement agreements with the U.S. Department of the Interior to relinquish its Carolina Long Bay and New York Bight leases awarded in 2022, marking a strategic shift away from offshore wind projects in the U.S.
- Funds Recovery and Reinvestment: Under the terms of the settlement, TotalEnergies will recover the lease fees paid and reinvest an equal amount into U.S. gas and power production and exports, which is expected to enhance its competitive position in the U.S. energy market.
- Market Analysis: The company's studies indicate that offshore wind developments in the U.S. are costly and could negatively impact consumer electricity prices, leading to the decision to avoid capital allocation to this technology in favor of more cost-effective energy solutions.
- Long-term Offtake Agreement: TotalEnergies has signed a Letter of Intent with Glenfarne for the long-term offtake of 2 million tons per year of liquefied natural gas over 20 years, further solidifying its leadership in the U.S. LNG market.
See More
