Energy Morning - 15 April 2025

Stress testing

We have stress-tested our coverage universe at a USD60/bbl oil price, concluding that most names remain dependent on rising oil prices to warrant upside potential from current share prices. Moreover, unless oil prices move higher, we see increasing risk of cuts in shareholder distributions for Vår Energi and Equinor, while the risk appears lower for Aker BP. Overall, we remain cautious as macro risks remain tilted to the downside. We continue to prefer Aker BP as it screens best on valuation and...

Weekly news, topics & discussion

This week, Equinor, Aker BP, and Vår Energi released their Q1 trading updates. Equinor’s realised liquids prices were broadly in line with consensus across all segments. Aker BP reported a modest production beat, 2% above consensus, with realised liquids and gas prices largely as expected. Vår Energi’s Q1 production was 2% below our estimate and consensus, while realised liquids prices met expectations and gas prices exceeded them by 4–11%.

Coffee, Croissants & Credit/Orsted, Telefonica, Virgin Media O2

European utilities: Although paused, US tariffs could put pressure on project returns

Energy Morning - 10 April 2025

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

E&P spending sensitivity explored

With an oil price at the mid-USD60s/bbl level, focus on the oil major overspending situation, and resulting impact on the outlook for offshore-focused oil services, is set to increase further. While oil companies would likely cut, or even eliminate, buyback programmes first, we expect increased focus on spending reductions and efficiencies, creating a more challenging business environment for oil services. Hence, we see a risk of oil companies taking a more cautious approach, resulting in projec...

Weekly news, topics & discussion

This week, we published previews for most of our coverage universe. For Aker BP, we estimate solid Q1 production of 450kboed, with our EBITDA forecast 12% above consensus, ahead of the trading update on 7 April. For Vår Energi, we expect a slow start to the year, with Q1e production of 277kboed, leaving our EBITDA c7% below consensus, ahead of the trading update on 11 April. In other news, Johan Castberg reached first oil this week, with ramp-up expected through Q2 2025.

Panoro Energy (Buy, TP: NOK38.00) - Set for strong FCF growth

Ahead of the Q1 report, due at 07:00 CET on 21 May, we forecast net production of 12.7kboed (no reliable consensus). Due to a significant underlift and limited crude volumes sold in the quarter, we estimate EBITDA of USD-2m (no reliable consensus). After several years of missing production guidance and investor expectations, we believe meeting 2025 guidance of 11–13kboed (we forecast 11.6kboed), supported by strong FCF growth and attractive shareholder distributions, would warrant a re-rating of...

Crude Quarterly Q1'25: weaker oil market fundamentals

Estimate changes from Crude Quarterly, 3 April

Valuation update

In this note, we show updated valuation statistics for the E&P sector.

Weekly news, topics & discussion

This week, we published a note on the harsh reality of USD70/bbl for our coverage. While investors appear to be positioning for lower oil prices, we believe consensus FCF estimates for NCS large caps remain overly aggressive. Meanwhile, DNO announced a discovery at the Kjøttkake prospect, north-west of Troll, adding ~NOK0.8/share (~4%) to DNO’s NAV and ~NOK1/share to Aker BP’s (

Valuation update

In this note, we show updated valuation statistics for the E&P sector

Weekly news, topics and discussion

This week, NCS February production was broadly in line with the NOD’s expectations, with total output flat MOM but down 2.4% YOY. Aker BP showed solid January production, while Equinor, Vår Energi, OKEA and DNO showed declines MOM. Halten East is now on stream, but its slow ramp-up limits Vår Energi’s 2025 uplift to ~5kboed, reinforcing the downside risk to its 330–360kboed guidance. Also, DNO successfully placed a new USD600m bond (8.5% coupon) to refinance DNO04 and for general corporate purpo...

NCS February production in line

The Norwegian Offshore Directorate’s (NOD) preliminary NCS figures for February showed liquids production of 1,938kboed (in line with its forecast) and gas production of 355mcm/d (3.8% above its estimate). Overall production was 4.17mmboed, flat MOM (1.8% above its forecast), but down 2.4% YOY. Company-wise, Aker BP reported solid production in January, while Equinor, Vår Energi, OKEA and DNO all reported production down MOM.

Energy Morning - 20 March 2025

In a mid-cycle plateau

Following recent updates from E&P companies, we have reduced our 2025 offshore spending estimate to 0.5% (from c3% earlier this year). This is driven by a combination of actual 2024 spending being higher than expected (8% versus 4% previously), creating tougher comparables and a reduction in spending plans from Pemex in 2025. Despite growth flattening out, we still see the cycle building in duration, with execution of deepwater developments remaining on the agenda, albeit with a delayed executio...

Energy Morning - 19 March 2025