TotalEnergies Reports 15% Drop in Q4 Earnings Amid Market Challenges

 French oil and gas giant TotalEnergies has reported a 15% decline in fourth-quarter earnings, citing lower crude oil prices and reduced refining margins as key factors.

The company’s adjusted net income for Q4 2024 stood at $4.4 billion, down from $5.2 billion in the same period the previous year. However, the figure slightly exceeded analysts’ expectations, which had forecasted earnings of $4.2 billion, according to a Visible Alpha consensus.

Despite the year-over-year decline, TotalEnergies’ Q4 performance showed improvement over Q3, where net income was recorded at $4.1 billion.

One of the main contributors to the downturn was the sharp drop in refining margins, which fell from $50.10 per metric ton in late 2023 to $25.90 per ton in Q4 2024. This decline was driven by:

• A nearly $10 per barrel decrease in crude oil prices
• Rising competition from new refineries in Africa and Asia, leading to squeezed profit margins in the refining sector

However, the company’s integrated liquefied natural gas (LNG) division remained resilient, posting a 35% increase in earnings to $1.4 billion. The growth was attributed to market volatility and increased trading profits.

Looking ahead, TotalEnergies expects higher natural gas prices, increased upstream production, and stronger power sales in early 2025, which could help offset some of the current market pressures.

In an effort to maintain shareholder confidence, the company announced a 7% increase in its annual dividend to €3.22 per share and confirmed share buybacks of $2 billion per quarter for 2025.