It was a week when oil prices logged their biggest percentage climb since early October and natural gas futures reached their highest level in about a year.
The headlines revolved around European energy biggie Equinor ASA’s EQNR hydrocarbon find in the North Sea and larger rival Shell’s SHEL pullout of Ukraine. Developments associated with Petrobras PBR, TC Energy TRP and BP plc BP also grabbed attention.
Overall, it was a bullish seven-day period for the sector. West Texas Intermediate (WTI) crude futures increased around 6.4% to close at $71.24 per barrel, while natural gas prices soared 10.8% to end at $3.13 per million British thermal units (MMBtu).
The crude price surge resulted from heightened geopolitical tensions, as Russia’s intercontinental missile use and ongoing conflict with Ukraine fueled supply concerns.
Natural gas settled with an even bigger gain. A combination of colder weather forecasts increased liquefied natural gas (“LNG”) exports, and a surprising drawdown in U.S. gas inventories were the main drivers.
Recap of the Week’s Most Important Stories
1. Equinor recently made a new oil and gas discovery in the Norwegian North Sea. The discovery was made within the Rhombi prospect, which lies in the production license (PL) 090. The Norwegian energy company has drilled an exploration well and a sidetrack at water depths of 355 meters in the Rhombi prospect, approximately 10 kilometers north of the Troll field in the North Sea.
The Norwegian Offshore Directorate (“NOD”) has confirmed that both wells have encountered hydrocarbons (oil and gas). The hydrocarbons have been found in the Sognefjord and Fensfjord formations and show good reservoir quality. Equinor has stated that the estimated reserves lie in the range of 13-28 million barrels of oil equivalent. Further, more than half of the reserves are estimated to be gas.
The NOD has mentioned that this discovery is the first of its kind to be made in the region in 2024. Equinor has also made many other discoveries in the region in recent years. EQNR is the operator of PL 090, holding a 45% stake. Its partners Vår Energi and INPEX Idemitsu Norge have a 40% and 15% stake, respectively. (Equinor Strikes New Oil and Gas Reserves in the Norwegian North Sea)
2. Shell, the British oil and gas giant, has entered into an agreement with Ukrnafta, a subsidiary of Naftogaz, to sell 51% of its gas station network in Ukraine. Following the deal’s closure, Ukrnafta will become a majority owner of Shell’s gas station network, which currently includes 118 functional stations. The rebranding will be completed within a year. Additionally, all the 1,550 employees will retain their jobs following the deal’s closure.
Shell ranks among the top 10 fuel distribution networks in Ukraine and 7th in terms of the number of stations. The stations are mostly located in areas with high traffic, ensuring maximum visibility among its customers. Per a statement from Naftogaz Group, earnings from the newly acquired business will contribute to the national budget of Ukraine in the form of dividends.
With this sale, Shell has marked its exit from Ukraine. The sale was confirmed by the energy firm. Due to the prolonged conflict between Russia and Ukraine, many companies have been forced to reconsider their presence in the region. Geopolitical instability and the possibility of operational disruptions have resulted in a challenging business environment, prompting several companies operating in the region to re-evaluate their businesses in both countries. (Shell Exits Ukraine, Sells Stake in Gas Station Network to Ukrnafta)
3. Petrobras, Brazil's largest oil and gas company, has announced an ambitious $111 billion investment plan for the 2025-2029 period, indicating a major move for both the company and the country’s energy sector. The plan, revealed through a securities filing on Monday, outlines Petrobras' goals for the next few years, highlighting its vital role in the economy of Brazil. The Zacks Rank #3 (Hold) company plans to focus on boosting oil production, refining and expanding its operations.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The total investment of $111 billion is about $9 billion more than the previous 2024-2028 strategy, with a focus on exploration, production and refining. Petrobras aims to strengthen its position as Latin America's top oil producer, by producing about 3.2 million barrels of oil per day.
A large portion of the investment, $77 billion, will go toward exploration and production, ensuring that Petrobras remains the leading oil producer in Latin America. This includes expanding production in Brazil's offshore oil fields and exploring new reserves. The company has been investing in cutting-edge technology to increase efficiency and recovery rates from existing fields. These efforts are crucial for Petrobras to meet the growing global demand for energy. (Petrobras Proposes $111 Billion Business Plan for 2025-2029)
4. TC Energy, a leading energy infrastructure company in North America, recently announced its guidance for fiscal 2025. The company estimates a comparable EBITDA in the range of C$10.7 billion to C$10.9 billion (approximately $7.63 billion to $7.78 billion), indicating an increase over its 2024 outlook.
This positive estimate implies the rising demand for natural gas and electrification, alongside the company’s strategic investments in key growth projects. The announcement came during TC Energy’s 2024 Investor Day, where the company outlined its plans to capitalize on increasing energy demands across North America.
The estimated rise in EBITDA for FY2025 is largely driven by the growing demand for natural gas, which is poised to remain a critical component of energy supply as the world transitions toward cleaner energy sources. The need for natural gas has been accelerating as a reliable and flexible source of energy to complement the rise of renewable energy sources like wind and solar. TC Energy is strategically positioning itself to meet this surge in demand, reinforcing the company’s commitment to enhancing its infrastructure and capacity to deliver energy efficiently. (TC Energy Forecasts Growth With C$1.5B Projects and Higher 2025 EBITDA)
5. BP, a leading UK-based energy company, and its partners in the Tangguh production sharing contract have announced the final investment decision for the $7 billion Tangguh Ubadari CCUS Compression (“UCC”) project in Papua Barat, Indonesia. The project is poised to unlock approximately 3 trillion cubic feet of additional gas resources, aligning with BP’s strategy to meet Asia's growing energy demand while advancing its low-carbon commitments.
The Tangguh UCC development is set to feature Indonesia’s first large-scale implementation of carbon capture, utilization, and storage technology. This innovative approach aims to sequester 15 million tons of CO2 in its initial phase, with potential for further expansion due to the area’s substantial storage capacity. The project includes developing the Ubadari gas field and enhancing existing infrastructure at the Tangguh LNG facility, which already boasts a liquefaction capacity of 11.4 million tons per year.
The Tangguh UCC project aligns with BP’s disciplined financial framework, meeting its return hurdle rates and reinforcing its focus on value-driven investments. With Tangguh UCC, BP continues to lead in leveraging technology and innovation to meet the dual challenge of energy security and decarbonization, setting a benchmark for future projects in the region. (BP Invests $7B in Indonesia Gas With First Carbon Capture Tech)
Price Performance
The following table shows the price movement of some major oil and gas players over the past week and during the last six months.
Company Last Week Last 6 Months
XOM +2.1% +3.2%
CVX +0.6% +3%
COP -0.5% -8.5%
OXY +3.9% -18.7%
SLB +2.4% -5.5%
RIG +5.9% -27.3%
VLO +0.5% -14.4%
MPC +0.6% -12.4%
With oil and gas moving up for the week, stocks were mostly northbound. The Energy Select Sector SPDR — a popular way to track energy companies — rose 2.7% last week. The sector tracker has increased 3.2% over the past six months.
What’s Next in the Energy World?
Market participants will also keep a close eye on regular data releases to gauge the direction of commodities. U.S. government statistics on oil and natural gas, one of the most reliable indicators, will be a key focus for energy traders. Fuel demand and stock drawdowns in the coming weeks will shape commodity price trends. Additionally, Baker Hughes' rig count data, a critical indicator of U.S. crude and natural gas production trends, is also closely monitored.
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