Oil and Gas Industry ‘Demonized,’ Novatek Says: IP Week Update

The heads of BP Plc, Total SE and Equinor ASA are among dozens of speakers convening for the annual International Petroleum Week conference, an event markedly different this year from previous gatherings.

The industry’s flagship event in London, which usually brings together company executives and hundreds of oil traders for a week of lavish parties, dealmaking and market chatter, will this time be held online.

A year ago, discussions centered on China’s response to the coronavirus amid concern the disease was rapidly becoming a global issue, causing oil prices to slump. This week’s event takes place as crude surges back toward $66 a barrel following massive cuts to supplies and a strengthening outlook for demand.

IP Week, run by the Energy Institute, runs Tuesday through Thursday. All time stamps are GMT.

Oil and Gas Producers ‘Demonized,’ Novatek Says (1:10 p.m.)

The oil and gas industry has been “demonized” over carbon emissions, Mark Gyetvay, chief financial officer of Russian gas giant Novatek PJSC, said in a panel discussion. The industry is “part of the problem, not the whole problem,” and “the consumption side is the one emitting more,” he said.

Novatek’s business will remain based on natural gas, according to Gyetvay. The company will be able to produce hydrogen for its own consumption, but “there are still a lot of questions that need to be answered before the industry really makes investments” there, he said.

JPMorgan, Vitol See Prices Staying Firm (12:20 p.m.)

JPMorgan Chase & Co., oil trader Vitol Group and refiner and fuel retailer Varo Energy BV shot down talk of a new oil supercycle but said a lack of supply response amid rising demand post-lockdown will keep prices for crude and most products firm in the short term.

Natasha Kaneva, executive director and head of global commodities strategy at JPMorgan, told a panel that the bank is bullish on oil for the next two years with a return to pre-Covid demand levels of about 100 million barrels a day by the end of 2021. The deep freeze in Texas will result in a loss of 1.2 million barrels a day of production in February and about 2 million barrels of refinery production during the month, she said.

Vitol’s global head of research, Giovanni Serio, said oil markets aren’t pricing in a supercycle with the back end of the price curve still weak. Jet fuel demand won’t return to pre-Covid levels until 2022 at the earliest. Roger Brown, the CEO of Varo, said he didn’t expect jet demand in Europe to return to pre-Covid levels until 2023 or 2024.

Total Proud to Pump Oil, Sees Big Future for Hydrogen (11:34 a.m.)

Total Chief Executive Officer Patrick Pouyanne tells the Energy Institute conference that his company is still proud to pump oil, but sees a big future for hydrogen. The French energy giant has a “high interest” in the clean-burning gas and wants to be a big producer of it one day.

He compared the burgeoning hydrogen sector to liquefied natural gas 40 years ago. Over that period, LNG has gone from being a niche industry to a major global market.

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