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Wed Jan 30, 2013, 12:23 PM

Record Profit Eludes Big Oil as Costs Outpace Brent Gain

Whenever I think about the sort of technologies, capital investment and mega-scale infrastructure that are required to find oil and get it out of the ground, it vaguely amazes me anybody can afford it. Maybe it's just me.

The world’s biggest oil companies are failing to convert the highest Brent crude prices ever into record profits as production costs climb and U.S. natural gas prices languish.

The London-traded benchmark for two-thirds of the world averaged $111.68 a barrel in 2012, up 0.7 percent from a then- record in 2011 and more than double the price in 2006. At the same time, oil and gas producers have lagged behind other industries in stock markets as profit growth failed to keep up. The MSCI World Oil & Gas Index lost 0.5 percent last year, compared with the broader World Index that has risen 13 percent.

“Even though Brent prices are up, so are the costs of producing that crude, and gas is a big drag,” said Jason Gammel, an analyst at Macquarie Capital Europe Ltd. in London. “That has negative effects on profitability.”


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Reply Record Profit Eludes Big Oil as Costs Outpace Brent Gain (Original post)
phantom power Jan 2013 OP
tblue Jan 2013 #1

Response to phantom power (Original post)

Wed Jan 30, 2013, 12:27 PM

1. Karma

Maybe God's trying to tell 'em something.

Pardon me if I don't weep for them.

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