Shares in France's TotalEnergies declined on Wednesday morning after the company reported a 31% drop in fourth-quarter (Q4) earnings.
ADVERTISEMENTAt the time of writing, TotalEnergies stock was down 1.23% at €59.45 on the London Stock Exchange, reflecting investor sentiment after the company reported its latest Q4 earnings results.
The energy giant said adjusted net income fell 31% in Q4 from a year earlier to $5.23 billion (around €4.8bn), missing the average analyst estimate of $5.66 billion (around €5.2bn), due to weaker oil and gas prices and shrinking refining margins.
TotalEnergies shares 2024 outlook
In its outlook for 2024, the energy giant acknowledged the uncertain economic environment ahead.
"Oil markets are facing geopolitical tensions in the Middle East on one hand and non-OPEC production growth balanced by OPEC+ policy on the other hand," a statement said.
This year, the company also highlighted that it expects net investments of $17 billion (around €15.5bn) to $18 billion (around €16.7bn), of which $5 billion (around €4,6bn) will be dedicated to integrated power.
Lower oil and gas prices hit earnings
The market volatility seen in 2022 after the Ukraine-Russia conflict began resulted in a huge spike in oil and gas prices, which was also reflected in the earnings results of the energy majors.
Despite the ongoing conflict and new geopolitical events disrupting energy markets, the price of oil and gas is not at the level seen back then.
For example, the price of Brent crude went up to $119 a barrel in February 2022, according to Trading Economics data. Currently, it is trading around $79 a barrel.
The latest results from TotalEnergies follows an update from BP, which reported its second highest annual profit in a decade.
Profits were $13.8bn (€12.8 bn) in 2023, down from the record $27.7bn (€25.7bn) in 2022, as earlier noted, when oil prices soared in the aftermath of Russia's invasion of Ukraine.
The fall in BP's annual profits also echo the recent results from Shell. Its profits fell to $28.2bn (€26.2bn) last year, down from $39.9bn (€37.05 bn) in 2022.
