Major oil and gas companies are warning that abandoning operations in Russia will result in billions of dollars of losses.
Several companies have warned that upcoming earnings results could be bad.
The suspension of operations in Russia could lead to a $5 billion loss for Shell in its upcoming quarterly earnings.
Shell closed its operations in Russia after the invasion of Ukraine and ended its involvement in the Nord Stream 2 project.
Potential losses could be as much as $25 billion, according to a warning by Shell rival BP.
American energy giant Exxon Mobil ceased operations in Russia at the end of the year, abandoning holdings estimated to be worth around $4 billion at the end of 2021, while Norwegian oil and gas giant Equinor is leaving some $1.2 billion in Russian investments on the table.
Wall Street analysts and investors are still assessing the impact of Western companies cutting ties with Russia under heavy sanctions, with President Joe Biden set to sign a ban on Russian energy, which was passed by the Senate on Thursday.
The oil and gas sector is becoming a new favorite of legendary investor Warren Buffet and his investing conglomerate.
The S&P 500 energy sector is up nearly 40% this year, far better than the benchmark index which is down about six percent. The shares of Shell, ExxonMobil, and Equinor are all up this year.
Major energy companies will give more information about potential losses from exiting Russia in their quarterly earnings reports next month. Despite the impact of lost business, most are expecting to report strong first-quarter earnings thanks to surging oil and gas prices.
The price of oil went up to as much as $130 per barrel last month, but have since moderated. The price of the US benchmark West Texas Intermediate is now at $98 per barrel, while the global benchmark is around $103 per barrel.
The major bank is the first to forecast a recession.
The worst quarter since the Covid Market Crash has been posted by stocks.
The energy stocks are doing well as oil and gas prices keep climbing.
The stock market fell after the U.S. banned Russian energy.
All Rights Reserved © 2024
