Key Highlights
- TotalEnergies (TTE) gained approximately 3% in premarket session following positive Q1 earnings guidance
- Elevated hydrocarbon prices projected to contribute $2–$2.5 billion to working capital during the quarter
- Middle East tensions disrupted roughly 100,000 bpd of output, representing approximately 15% of total production
- Liquefied natural gas performance anticipated to significantly exceed Q4 levels, supported by 10% output growth and robust trading activity
- European refining margins reached $11.40 per ton, marking a 192% year-over-year increase; complete quarterly results scheduled for April 29
TotalEnergies (TTE) disclosed Thursday that it anticipates a significant uptick in first-quarter profitability, propelled by elevated hydrocarbon prices and vigorous LNG trading operations, despite production disruptions stemming from the escalating Middle East crisis.
The French energy giant’s American depositary receipts advanced roughly 3% during premarket hours following the announcement.
According to the company’s guidance, first-quarter production volumes are anticipated to remain relatively stable at approximately 2.55 million barrels of oil equivalent per day, matching the previous quarter’s output.
The Iranian conflict has compelled TotalEnergies to reduce or suspend operations across Qatar, Iraq, and offshore United Arab Emirates facilities. Additionally, a refining facility in Saudi Arabia was recently shuttered following damage from the hostilities. Collectively, these disruptions are removing approximately 100,000 barrels per day from production capacity — about 15% of the company’s aggregate output.
New production facilities coming online in Libya and Brazil are partially offsetting these losses.
Price Gains and Trading Activity Drive Profitability
Notwithstanding the production shortfall, TotalEnergies indicated that rising oil and gas prices are projected to inject between $2 billion and $2.5 billion into working capital throughout the quarter.
Liquefied natural gas segment results are positioned to substantially surpass fourth-quarter performance. The energy major attributed this to 10% production expansion and vigorous trading operations, benefiting from heightened market volatility.
European refining margins throughout Q1 averaged $11.40 per ton — representing a 192% surge from $3.90 during the comparable period last year, exceeding analyst projections. Refinery capacity utilization exceeded 90% during the period.
Integrated Power segment results are forecast at approximately $500 million, remaining essentially unchanged year-over-year. The Marketing and Services division is similarly tracking consistent with last year’s first quarter.
Wall Street Perspective
Jefferies analyst Mark Wilson characterized the guidance as a “small positive,” highlighting that TotalEnergies seems to be managing working capital challenges more effectively than certain competitors, including Shell and BP.
Wilson suggested potential for roughly 10% upside versus Q1 consensus net income estimates of €4.8 billion. He identified LNG trading operations as the primary catalyst for outperformance.
TotalEnergies has scheduled the release of complete first-quarter financial results for April 29.
