Norway’s largest company, Statoil, looks set to keep logging record amounts of earnings, given its lower cost base and rising oil prices. Some analysts think its announcement on Wednesday of a huge jump in earnings is expected to be the first of many.
Trond Omdal, an oil analyst at Pareto Securities in Oslo who follows the company and industry closely, told state broadcaster NRK that he thinks Statoil will generate its largest cash flow in history this year. Omdal thinks the cash will keep pouring in for several years to come.
“Dividends will rise and the share price will hit historically high levels,” Omdal told NRK after Statoil reported fourth-quarter results of USD 4 billion, and USD 1.3 billion after tax. That was more than double those in the prior year. (external link to the company’s own earnings release).
That’s largely because Statoil is now structured to earn money with an oil price as low as USD 15 per barrel. With Norway’s North Sea Brent crude oil now trading at nearly USD 70 a barrel, prospects are bright indeed.
The market responded favourably to Statoil’s strong earnings report as well on Wednesday, with its share price jumping by around 4 percent during midday trading. That meant it more than recovered Tuesday’s losses in a global stock sell-off, and the Oslo Stock Exchange in general was having a much better day.
newsinenglish.no staff
