2025-01-07 21:41
Pension investors backing resolution have combined assets of more than $86 billion They want information on how strategy is compatible with net zero goal Shell says confident of future role of LNG LONDON, Jan 7 (Reuters) - Shell's (SHEL.L) , opens new tab plans to increase sales of liquefied natural gas (LNG) have been called into question by a by major group of shareholders that has filed a resolution asking whether the strategy is compatible with a goal to cut carbon emissions. Shell is the world's largest LNG trader and CEO Wael Sawan is betting on growing demand, but analysts and climate activists have raised concerns about the implications for climate targets. Shareholders, including Brunel Pension Partnership, Greater Manchester Pension Fund and Merseyside Pension Fund, with combined assets of $86 billion, have asked Shell to provide more information on how its growth assumptions are compatible with global energy demand and its plans to be net zero by 2050. Shell's demand outlook is higher than all scenarios published by the International Energy Agency and has not been materially revised despite major changes in the global energy market, the investor group said. LNG is projected to account for 30% of Shell's upstream hydrocarbon production in 2030, while its demand outlook is 301% higher than the IEA's Net Zero Emissions by 2050 scenario. This raises governance questions and financial risks for investors, said Sarah Brewin, company strategist at the Australasian Centre for Corporate Responsibility, a co-filer of the resolution. Vaishnavi Ravishankar, head of stewardship at Brunel Pension Partnership, said the group is "deeply concerned about the apparent disconnect" between Shell's LNG and climate strategies. "We need to see further transparency to assess Shell's alignment with climate goals, particularly in the context of the recent removal of its interim 2035 climate target," Ravishankar said. In March, Shell weakened its 2030 carbon reduction target, citing expectations for strong gas demand and retired a previous target to reduce its carbon intensity by 2035, following a similar decision by peer BP (BP.L) , opens new tab. A Shell spokesperson said the company's shareholders have "strongly backed our strategy to deliver more value with less emissions at successive AGMs, with the growing role of LNG at the heart of this strategy". "We are confident in the future role of LNG in our strategy," the spokesperson said. The resolution was also supported by 100 independent shareholders represented by UK-based responsible investment NGO ShareAction. Sign up here. https://www.reuters.com/sustainability/climate-energy/shareholders-climate-resolution-challenges-disconnect-shells-lng-strategy-2025-01-07/
2025-01-07 21:37
Jan 7 (Reuters) - Portuguese oil company Galp Energia (GALP.LS) , opens new tab said on Tuesday that Chief Executive Filipe Silva had resigned following a company investigation into an anonymous complaint about an alleged personal relationship between him and a company manager. Galp said the CEO has notified Chairwoman Paula Amorim of his resignation "for family reasons." The new executive leadership will be announced in the coming days, it said in a statement. On Saturday, economic website ECO reported that Galp's ethics committee was reviewing alleged conflicts of interest due to a close and personal relationship, which "had been kept secret," with the female executive who reports to the CEO. Galp's code of conduct requires personal relationships to be communicated to the company's ethics committee when potential conflicts of interest are involved. Silva has worked at Galp for the last 12 years and was chosen as CEO in January 2023 for a four-year term due to end in late 2026. Galp's main business is extracting oil and gas from a rich offshore field in Brazil. The company also runs the Sines refinery in Portugal and renewable energy plants. Sign up here. https://www.reuters.com/business/energy/portugals-galp-ceo-resigns-after-alleged-relationship-probe-2025-01-07/
2025-01-07 21:24
Nuclear fission and fusion, hydropower and geothermal among energy that could qualify Trump has said he will gut IRA climate law to cut costs Biden team says subsidies will help lower energy costs WASHINGTON, Jan 7 (Reuters) - The Biden administration on Tuesday released guidance to help companies secure clean energy tax credits under the 2022 Inflation Reduction Act, finalizing a program to extend subsidies long available for wind and solar to other low carbon sources. The move is part of outgoing President Joe Biden's actions meant to shore up his administration’s broader efforts to fight climate change. They could prove vulnerable once President-elect Donald Trump takes office later this month on a platform of cutting spending and maximizing fossil fuel output. Trump has said he will gut the IRA, Biden’s signature climate law, to save the U.S. budget hundreds of billions of dollars, though doing so would require support from Congress. U.S. officials announcing Tuesday’s guidance said the IRA's technology neutral clean energy program offers as much as 30% tax credits for production and investments in climate-friendly power - a perk that has been available to solar and wind projects for years. The program identifies additional technologies that may be eligible, including marine and hydrokinetic energy, nuclear fission and fusion, hydropower, geothermal and some forms of waste energy recovery. The administration said the program was crucial to decarbonizing the power sector, the source of around a quarter of U.S. greenhouse gas emissions, and expanding electricity capacity when demand from datacenters, industrial users, and electric vehicle owners is surging. Deputy Treasury Secretary Wally Adeyemo said in a call with reporters that repealing the subsidies could lead to higher power prices for consumers by slowing the pace of new power projects and raising costs for developers. "Given the increase in demand for electricity throughout this country, and the fact that one of the things that the American people are the most concerned about is increased costs, removing these tax credits would have significant detrimental impact," he said. An analysis from the Department of Energy showed the credits, along with other IRA and Bipartisan Infrastructure Law provisions, are meant to save U.S. households up to $38 billion on electricity bills through 2030. The Biden administration has issued other measures in recent days to try to cement its climate agenda. They include banning offshore oil and gas drilling in new areas of the Atlantic, Pacific and elsewhere, and finishing guidance on how companies can secure credits for green hydrogen, produced from renewable energy and needed to decarbonize heavy industry and transport. Sign up here. https://www.reuters.com/sustainability/climate-energy/biden-team-wraps-up-expanded-clean-energy-credit-guidance-2025-01-07/
2025-01-07 21:21
Jan 7 (Reuters) - Expand Energy (EXE.O) , opens new tab, the biggest U.S. natural gas producer, remains on track to boost output to around 7 billion cubic feet per day (bcfd) in 2025, CEO Nick Dell’Osso said at the Goldman Sachs Energy, CleanTech & Utilities Conference on Tuesday. With the weather turning extremely cold this week and gas demand and prices rising, Dell'Osso said he has received a lot of questions about whether Expand would boost output faster than previously projected. "The answer is no. Nothing has changed for us," Dell'Osso said. "You don't want to grow for a season, you want to grow for something that is durable over several years." After gas prices collapsed in the first half of 2024, several U.S. energy firms reduced gas output. Those reductions caused annual production in 2024 to decline for the first time since the COVID-19 pandemic cut demand for the fuel in 2020. "So now, we can utilize some of that capacity we (deferred) in 2024 ... to offset declines," Dell'Osso said. "We can level out our production (at) a good level in the range of 7 bcfd." Expand, which was formed by the merger of Chesapeake Energy and Southwestern Energy, said it produced about 6.75 bcfd of gas equivalent in the third quarter of 2024. Shares of Expand were trading around $103.30, their highest since November 2022. The U.S. Energy Information Administration projected total U.S. gas output would rise to 103.7 bcfd in 2025 after declining to 103.2 bcfd in 2024 from a record 103.8 bcfd in 2023. One billion cubic feet of gas can supply about 5 million U.S. homes for a day. After average gas prices at the U.S. Henry Hub benchmark in Louisiana collapsed to a four-year low of around $2.19 per million British thermal units (mmBtu) in 2024, energy analysts forecast prices would rise to a three-year high of $3.44 in 2025. Dell'Osso said U.S. demand for gas for export was on track to rise by around 5.6 bcfd by the end of 2026 as new liquefied natural gas (LNG) export plants enter service. Plants under construction include Venture Global LNG's Plaquemines in Louisiana, Cheniere Energy's (LNG.N) , opens new tab Corpus Christi expansion in Texas and Exxon Mobil (XOM.N) , opens new tab/QatarEnergy's Golden Pass in Texas. The U.S. currently exports about 13% of the gas it produces as LNG. That percentage will likely grow in coming years as more export plants enter service. Dell'Osso said he wants to sell more gas to customers at international prices, noting 15%-20% of total sales would be a good target. But with only one international supply deal and a lot of gas to sell after the merger, he said it would likely take a long time before Expand's international sales reach that level. Sign up here. https://www.reuters.com/business/energy/expand-energy-still-track-boost-us-gas-output-7-bcfd-2025-ceo-says-2025-01-07/
2025-01-07 21:00
US service sector growth picks up in December Micron to provide memory for Nvidia gaming chips, shares up Tesla slips 4% after brokerage downgrade Indexes down: Dow 0.42%, S&P 500 1.11%, Nasdaq 1.89% Jan 7 (Reuters) - U.S. stocks tumbled on Tuesday after a batch of upbeat economic data raised concerns that an inflation rebound could slow down the Federal Reserve's pace of monetary policy easing. Stocks gave up early gains after a Labor Department report showed job openings unexpectedly increased in November, while a separate report said services sector activity accelerated in December with a measure tracking input prices surging to a near two-year high. "Markets are starting to recognize that they thought we were in the eighth inning of the inflation fight but now it's going to be higher for longer," said Joe Mazzola, head of trading and derivatives strategist at Charles Schwab. Benchmark 10-year Treasury yields hit 4.699% after the data pointed to a strong economy, the highest since April 26. "Both of those things potentially have inflationary impacts and, as a result, yields have increased," said Mike Dickson, head of research at Horizon Investments, referring to the economic data. "That's definitely weighing on stocks." Signs of continued resilience in the economy have pushed back expectations on when the central bank can deliver its first interest rate reduction this year. Traders now see the next cut more likely in June and the Fed staying on hold for the rest of 2025, according to the CME Group's FedWatch tool. Concerns over the impact of possible tariffs by the incoming Trump administration on consumer prices have also been on investors' minds. "A mix of solid growth and a new wave of inflationary pressure from tariffs means the Fed will likely switch from cutting interest rates at every decision ... to pausing in between rate cuts in 2025," Bill Adams, chief economist for Comerica Bank, said in a note. The Dow Jones Industrial Average (.DJI) , opens new tab fell 178.20 points, or 0.42%, to 42,528.36, the S&P 500 (.SPX) , opens new tab lost 66.35 points, or 1.11%, to 5,909.03 and the Nasdaq Composite (.IXIC) , opens new tab lost 375.30 points, or 1.89%, to 19,489.68. Higher yields pushed technology-sector stocks (.SPLRCT) , opens new tab lower by 2.39%. Shares of AI bellwether Nvidia (NVDA.O) , opens new tab fell 6.22%. Most of the 11 S&P 500 sectors declined, except for healthcare (.SPXHC) , opens new tab and energy stocks (.SPNY) , opens new tab. The main focus of the week is the key non-farm payrolls data, along with minutes from the Fed's December meeting. In the previous session, the S&P 500 (.SPX) , opens new tab and the Nasdaq (.IXIC) , opens new tab closed short of one-week highs on uncertainty after President-elect Donald Trump denied a report that his team was exploring less aggressive tariff policies. Tesla (TSLA.O) , opens new tab shares fell 4% after BofA Global Research downgraded the stock to "neutral" from "buy." Micron Technology (MU.O) , opens new tab rose 2.67% after Nvidia boss Jensen Huang said the chipmaker was providing memory for the AI bellwether's GeForce RTX 50 Blackwell family of gaming chips. Citigroup (C.N) , opens new tab rose 1.29% on bullish coverage from Truist Securities, while Bank of America (BAC.N) , opens new tab went up 1.5% after positive ratings from at least three brokerages. Some big banks are expected to report quarterly earnings in the next week. Declining issues outnumbered advancers by a 2.14-to-1 ratio on both the NYSE and the Nasdaq. The S&P 500 posted 9 new 52-week highs and 16 new lows while the Nasdaq Composite recorded 60 new highs and 58 new lows. Volume on U.S. exchanges was 20.45 billion shares, compared with the 12.52 billion average for the full session over the last 20 trading days. Markets will be closed on Thursday for a national day of mourning to mark the death of former President Jimmy Carter. Sign up here. https://www.reuters.com/markets/us/futures-subdued-ahead-economic-data-trumps-plans-eyed-2025-01-07/
2025-01-07 20:46
Jan 7 (Reuters) - Fitch Ratings on Tuesday upgraded its rating for El Salvador to B- from its prior CCC+ status, along with a stable outlook, citing a reduction in financing needs helped by a recently announced International Monetary Fund (IMF) program. The B- rating is, however, six notches into the credit rating agency's speculative grade, or junk, status. Last month, the IMF announced a staff-level agreement with El Salvador on a new loan program for about $1.4 billion to support government reforms. "Fitch expects the program to support implementation of fiscal consolidation measures which in conjunction with the reduction in outstanding short-term debt owed to domestic banks and buyback of external debt, due to last year's liability management operations, should reduce financing needs," according to a statement from the ratings agency. Fitch added that successful fiscal consolidation could boost investor confidence and potentially enable future debt issuances. "Hooah!" wrote President Nayib Bukele in a post on X celebrating the upgrade. Fitch expects Salvadoran economic growth to slow to 1.9% in 2024, from a 3.5% expansion in 2023, and then pick up to 2.3% growth this year despite the government's heavy debt burden. Sign up here. https://www.reuters.com/world/americas/fitch-upgrades-el-salvador-after-imf-deal-eases-financing-needs-2025-01-07/
