Key Highlights
- TotalEnergies (TTE) shares advanced approximately 3% in premarket sessions following an upbeat Q1 performance preview
- Elevated oil and natural gas prices projected to contribute $2–$2.5 billion to working capital during the first quarter
- Middle East tensions reduced production by roughly 100,000 barrels per day, representing approximately 15% of overall output
- Liquefied natural gas performance anticipated to significantly exceed Q4 levels, supported by 10% output increase 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) announced Thursday that it anticipates a substantial increase in first-quarter profitability, fueled by elevated commodity prices and vigorous liquefied natural gas trading activity, despite production setbacks stemming from the escalating Middle East crisis.
The French oil and gas giant’s American depositary receipts jumped approximately 3% during premarket hours after the company issued its trading update.
According to the announcement, first-quarter production levels are projected to remain relatively stable at approximately 2.55 million barrels of oil equivalent daily compared to the previous three-month period.
The ongoing Iran conflict has compelled TotalEnergies to reduce or suspend operations across Qatar, Iraq, and offshore facilities in the United Arab Emirates. Additionally, a refinery facility in Saudi Arabia was recently shuttered following damage. Collectively, these disruptions are reducing output by approximately 100,000 barrels daily — equivalent to roughly 15% of the company’s total production capacity.
New operational launches in Libya and Brazil are partially offsetting these losses.
Price Strength and Trading Activity Drive Profitability
Notwithstanding the production challenges, TotalEnergies indicated that strengthening hydrocarbon prices are projected to boost working capital by an estimated $2 billion to $2.5 billion throughout the quarter.
Liquefied natural gas performance is positioned to substantially surpass fourth-quarter figures. The company attributed this to 10% production expansion and vigorous trading operations, benefiting from market volatility conditions.
European refining margins throughout Q1 averaged $11.40 per ton — representing a 192% surge from $3.90 during the comparable period last year, and exceeding analyst projections. Refinery capacity utilization exceeded 90%.
Integrated Power segment results are anticipated at approximately $500 million, remaining essentially unchanged year-over-year. The Marketing and Services division is likewise performing consistently with the prior-year quarter.
Wall Street Perspective
Jefferies equity analyst Mark Wilson characterized the trading statement 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 the possibility of roughly a 10% upside surprise relative to the Q1 consensus net income estimate of €4.8 billion. He identified liquefied natural gas trading as the primary catalyst for outperformance.
TotalEnergies has scheduled its complete first-quarter earnings release for April 29.
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