Austrian energy group OMV's earnings hit by oil and gas price falls

Reuters

Published Feb 01, 2024 06:32

Updated Feb 01, 2024 08:45

By Andrey Sychev and Tristan Veyet

(Reuters) -Austrian oil and gas group OMV reported a drop in fourth-quarter earnings on Thursday, citing declines in previously high prices.

Although OMV's quarterly operating profit adjusted to strip out one-off effects and inventory gains or losses slid 32% year on year to 1.43 billion euros ($1.54 billion), it was slightly above expectations of analysts polled by the company.

Margins at petrochemicals companies have been squeezed by a drop in energy prices from the peaks reached after the start of the Ukraine war in 2022.

OMV said its energy sales, its main source of income, were also hit by delays in supplies from Libya, Norway and Tunisia.

Libya's National Oil Corporation (NOC) recently declared force majeure at its Sharara oilfield, in which OMV holds a stake, citing protests in the area.

For 2024, OMV expects total hydrocarbon production to decline to between 330,000 and 350,000 barrels of oil equivalent per day (boe/d) depending on the timing of its divestment of Malaysian assets and the situation in Libya.

It sees the average Brent crude oil price per barrel at around $80 for this year, down from the 2023 average of $83.

For gas prices, OMV forecasts 25 euros per megawatt hour in 2024 versus 29 per megawatt hour last year.

Britain's Shell (LON:RDSa) also saw a slump in 2023 profit on lower oil and gas prices, but still managed to increase its dividend and extend a share buyback.