What to expect as Big Oil reports second-quarter earnings

Published

4 years ago

July 26, 2021

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An oil pump jack operates at the Inglewood Oil Field in Culver City, California, U.S., on Sunday, July 11, 2021.

Kyle Grillot | Bloomberg | Getty Images

LONDON — Oil and gas majors are likely to report bumper second-quarter earnings in the coming days, energy analysts have told CNBC, following a brutal 12 months by virtually every measure.

The expected upswing would build on a surprisingly strong showing in the first quarter and lend further support to the oil and gas industry’s efforts to pay down debt and reward investors.

“Big Oil” companies, referring to the world’s largest oil and gas majors, still face significant challenges and uncertainties, however.

These include the remarkable success of shareholder activism in recent months, a “tremendous degree” of ongoing investor skepticism and intensifying pressure to massively reduce fossil fuel use in order to meet the demands of the climate emergency.

“Europe’s integrated oil sector already enjoyed surprisingly strong earnings in 1Q, but 2Q is set to show further improvement as commodity prices took another step up,” analysts at Morgan Stanley said in a research note.

International benchmark Brent crude futures rose to an average of $69 a barrel in the second quarter, the Wall Street bank said, up from an average of $61 in the first three months of the year. The oil contract was last seen trading at around $73.57.

Oil companies that ignore climate in their earnings calls will be seen as laggards. Long-term investors will conclude they are financially risky.

Kathy Hipple

Finance professor at Bard College

Analysts at Morgan Stanley noted that energy major share prices continue to be anchored by their dividend distributions. Notwithstanding substantial increases to free cash flow forecasts, the bank said Big Oil dividend expectations remain “rather static.”

“The energy transition confronts investors with much uncertainty, and the sector’s capital allocation track record has been mixed at best over the last decade. Hence, investors are only valuing the cash flow paid to them, with little credit given for cash flow retained within companies,” they said.

“As the dividend outlook has not improved much, and dividend yields in aggregate are already low by historical standards, share prices have trailed the earnings outlook considerably.”

In Europe, Royal Dutch Shell and TotalEnergies will report second-quarter earnings on July 29, with BP scheduled to follow on Aug. 3. Stateside, ExxonMobil and Chevron are expected to publish their latest figures on July 30, while ConocoPhillips will report second-quarter earnings on Aug. 3.

Fuel prices on a sign at a BP gas station in Louisville, Kentucky, on Friday, Jan. 29, 2021.

Luke Sharrett | Bloomberg | Getty Images

Rene Santos, manager for North America supply at S&P Global Platts Analytics, told CNBC via email that he expects second-quarter earnings from U.S.-based energy companies to be “significantly higher” when compared to the same period in 2020.

This is “mainly due to much higher oil prices,” he added. “In addition, the majors, large and mid-cap companies have kept capital discipline and have continued to focus on paying down debt and increasing free cash flow instead of increasing activity [drilling and completion] despite higher oil prices.”

Santos said S&P Global Platts Analytics also foresee an increase in the reporting of ESG activity, noting that it “looks like pressure from environmental groups and fear of more regulations from the current administration is persuading many companies to do more to decrease emissions.”

Growing climate risk

The oil and gas industry was sent into a tailspin last year as the coronavirus pandemic coincided with a historic fuel demand shock, plunging commodity prices, unprecedented write-downs and tens of thousands of job cuts. The torrent of bad news prompted the head of the International Energy Agency to suggest it may come to represent the worst year in the history of oil markets.

Oil prices have since rebounded to multi-year highs and all three of the world’s main forecasting agencies — OPEC, the IEA and the U.S. Energy Information Administration — now expect a demand-led recovery to pick up speed in the second half of 2021.

Clark Williams-Derry, energy finance analyst at IEEFA, a non-profit organization, said he expects oil and gas companies to try to claim a clean bill of health after a bumper second quarter. “That’s the mantra that we will hear,” he told CNBC via telephone.

However, while energy majors will likely have had the opportunity to pay down some debt after generating a significant chunk of cash from their operations, Williams-Derry said that this hides the fact that these companies have not invested much in future production.

Members of the environmental group MilieuDefensie celebrate the verdict of the Dutch environmental organisation’s case against Royal Dutch Shell Plc, outside the Palace of Justice courthouse in The Hague, Netherlands, on Wednesday, May 26, 2021. Shell was ordered by a Dutch court to slash its emissions harder and faster than planned, dealing a blow to the oil giant that could have far reaching consequences for the rest of the global fossil fuel industry.

Peter Boer | Bloomberg | Getty Images

“What I think the market is starting to signal is that it kind of likes when the oil companies shrink and aren’t going all out into new production but they are using the cash that their operations are generating to pay down debt and reward investors.”

Longer term, Williams-Derry warned there’s a “tremendous degree” of investor skepticism about the business models of oil and gas firms, citing the deepening climate crisis and the urgent need to pivot away from fossil fuels.

“We saw earlier in the year signs of a sea change in investor thinking about, frankly, the legal status of some of the supermajors,” he said, referring to a series of landmark courtroom and boardroom defeats for the likes of Royal Dutch Shell, ExxonMobil and Chevron.

“So, even if you are riding high for a quarter or two when prices are high, the reality is still that stock prices are way below the market as a whole and there’s just not the investor enthusiasm for the old business model that I think these companies probably expected to see,” he said.

Energy transition

Kathy Hipple, finance professor at Bard College in New York, told CNBC via email that she believes two key themes are likely to emerge this earnings season: Addressing investor concerns around climate risk and the outlining of new business models to survive a pivot toward renewables.

“Investors are future-oriented and will look past a short-term pop in earnings compared to last year’s dismal second-quarter results,” Hipple said. “They want to see concrete business strategies that acknowledge the energy transition that is gathering speed.”

She argued it was important to note that these earnings will be announced “against a backdrop of climate disasters around the globe,” from extreme heat in the Pacific Northwest to flooding in Europe and China.

“Oil companies that ignore climate in their earnings calls will be seen as laggards. Long-term investors will conclude they are financially risky,” Hipple said.

Environment

Homeowners share surprising, real-world data after installing solar panels

Published

10 hours ago

November 24, 2025

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Homeowners share surprising, real-world data after installing solar panels

Homeowner shares unexpected, real-world data after installing rooftop solar panels: I'm pretty surprised

Are you wondering what kind of results you’d get if you added a home solar system to your roof? Homeowners are sharing their results online — and the real-world data might surprise you!

In a recent post to r/Solar, a Reddit user going by DontBuyBitcoin shared a screenshot indicating that their newly-installed ~11.5 kW system produced over 1,700 kWh of electricity in October. “Pretty surprised by the production of the system I got,” writes DontBuyBitcoin. “11.48KW. I cant wait to see what JUNE-AUGUST [2026] going to look like 😍 I wish SolarEdge will make their app better looking with more functionality”

Home solar energy chart

Other Redditors were quick to share in the enthusiasm. “Congratulations!!! Great numbers,” wrote LegalNet4337. “We got 1.6 MWh with a 14.45 kW system. East and West facing panels in SoCal.”

That 1,700 kWh is nothing to sneeze at. Based on the current national average electricity price of about $0.17/kWh (in AUG2025), DontBuyBitcoin’s admittedly large-ish system translates to ~$290 of potential savings. In a higher rate state like Illinois, with a projected 2026 kWh rate that’s closer to $0.18/kWh, that’s ~$306/mo.

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We expect retail electricity prices to residential customers will average 17 cents per kilowatthour (kWh) nationwide in 2025, a 4% increase over 2024, and then rise to approximately 18 cents/kWh in 2026. This rise continues a trend in which residential electricity prices have increased at an average annual rate of 5% each year since the COVID-19 pandemic. The increase in retail electricity prices this year comes as the cost of natural gas to the electric power sector was up more than 40% in 1H25 compared with a year earlier, with similar year-over-year increases forecast for the remainder of 2025. The average cost of natural gas for power generation in our forecast increases another 17% in 2026.

US ENERGY INFORMATION ADMINISTRATION (EIA)

Those are big numbers, but 11-15 kW rooftop solar systems are big. Significantly bigger, in fact, than the US average, ~6.6 kW in 2024 – but you don’t have to have a big system in order to post big numbers. Superior weather conditions and perfect PV panel placement can also get the job done, as another Redditor found.

“The last 2 days we have had perfect weather here in South Florida and I have been able to get over 30 kWh from a 5 kW system with a 3.8 kW inverter. This is the highest I have seen since getting PTO in September,” wrote Redditor dlewis23, who shared another SolarEdge graph. “I am super happy with seeing over 30 kWh in a single day.”

30 kW/day from home solar

Taken altogether, these real-world snapshots prove that whether it’s a modest 5 kW array or a beefy 10+ kW setup, homeowners out in the real world are seeing meaningful, measurable differences from their home solar installations. And, with retail electricity prices projected to keep on rising through the decade, every kilowatt counts.

Electrek’s Take

When we ran our “Why did you choose to go solar?” survey back in September, only 32.6% of respondents chose, “Lowering my monthly utility bills” as their primary motivation to go solar. That result proved, in my mind, that Electrek readers are just better people than most, and seem to be willing to spend a little more to do something positive for their environment and their community.

That said, wasn’t it no less a thinker than Albert Einstein who said, “Compound interest is the most powerful force in the universe” (Google it.)? And, with a 5% rate hike compounding every year from now until the AI and data center bubbles burst, the impact energy rates may have on all our pocketbooks may be enough to put “Lowering my monthly utility bills” back on top.

If and when that happens: be smart, get several quotes, and understand the difference between buying and leasing your PV system (especially if you plan on selling your home in the foreseeable future).

SOURCES: Reddit, EIA; featured image via Tesla.

If you’re considering going solar, it’s always a good idea to get quotes from a few installers. To make sure you find a trusted, reliable solar installer near you that offers competitive pricing, check out EnergySage, a free service that makes it easy for you to go solar. It has hundreds of pre-vetted solar installers competing for your business, ensuring you get high-quality solutions and save 20-30% compared to going it alone. Plus, it’s free to use, and you won’t get sales calls until you select an installer and share your phone number with them.

Your personalized solar quotes are easy to compare online and you’ll get access to unbiased Energy Advisors to help you every step of the way. Get started here.

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Environment

Volvo set to ditch LiDAR for 2026 – and Luminar is BIG mad

Published

23 hours ago

November 23, 2025

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Volvo set to ditch LiDAR for 2026 – and Luminar is BIG mad

Volvos Are Losing Their LiDAR Roof Bump For Good And Luminar Isn’t Happy

It seems like the writing was already on the wall last week when Volvo moved to make its Luminar-supplied LiDAR system an option – there are now reports that the Swedish car brand is set to ditch LiDAR tech entirely in 2026.

In a recent SEC filing following a missed interest payment on its 2L notes, Luminar confirmed that Volvo’s new ES90 and EX90 flagship models (along with the new Polestar 3) would no longer be offered with LiDAR from Luminar. The move signals a full reversal on the safety tech that had started as standard equipment, then became an option, and is now (according to reports from CarScoops) gone altogether.

In a statement, a Volvo Cars USA spokesperson added the decision was reportedly made, “to limit the company’s supply chain risk exposure, and it is a direct result of Luminar’s failure to meet its contractual obligations to Volvo Cars.”

This is what Luminar had to say about the current, icy state of the two companies’ relationship as of the 31OCT filing:

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The Company’s largest customer, Volvo Cars (“Volvo”), has informed us that, beginning in April 2026, Volvo will no longer make our Iris LiDAR standard on its EX90 and ES90 vehicles (although Iris will remain an option). Volvo also informed the Company that it has deferred the decision as to whether to include LiDAR, including Halo (Luminar’s next generation LiDAR under development), in its next generation of vehicles from 2027 to 2029 at the earliest. As a result of these actions, the Company has made a claim against Volvo for significant damages and has suspended further commitments of Iris LiDAR products for Volvo pending resolution of the dispute. The Company is in discussions with Volvo concerning the dispute; however, there can be no assurance that the dispute will be resolved favorably or at all. Furthermore, there can be no guarantee that any claim or litigation against Volvo will be successful or that the Company will be able to recover damages from Volvo.

As a result of the foregoing, the Company is suspending its guidance for the fiscal year ending December 31, 2025.

LUMINAR

On November 14, Luminar confirmed that Volvo had terminated its contract altogether, in a blow that could leave Luminar rethinking its long-term future and planning litigation against its biggest ex-customer.

The news follows a host of significant upgrades to the EX90 that include a new, more dependable electronic control module (ECM) and 800V system architecture for faster charging and upgraded ADAS that improves the automatic emergency steering functions and Park Pilot assistant.

Electrek’s Take

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You can’t spend years telling everyone you’re miles ahead because you have LiDAR, then ditch LiDAR, and pretend no one is going to call you out on it. They had better hope they don’t up on Mark Rober’s YouTube channel doing a Wile E. Coyote impression (above).

That said, it’ll be interesting to see if ditching the LiDAR has a negative impact there. Or, frankly, whether ditching the LiDAR and its heavy compute loads will actually help mitigate some of the EX90’s niggling software issues. It could go either way, really – and I’m not quite sure which it will be. Let us know which way you think it’ll go in the comments.

SOURCE: Luminar, via SEC filing; featured image by Volvo.

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Environment

John Deere electric riding mower gets removable batteries from EGO

Published

1 day ago

November 23, 2025

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John Deere electric riding mower gets removable batteries from EGO

John Deere and EGO Collaborate for a New Cordless ZT Mower

The new John Deere Z370RS Electric ZTrak zero turn electric riding mower promises all the power and performance Deere’s customers have come to expect from its quiet, maintenance-free electric offerings – but with an all new twist: removable batteries.

The latest residential ZT electric mower from John Deere features a 42″ AccelDeep mower deck for broad, capable cuts through up to 1.25 acres of lawn per charge, which is about what you’d expect from the current generation of battery-powered Deeres – but this is where the new Z370RS Electric ZTrak comes into its own.

Flip the lid behind the comfortably padded yellow seat and you’ll be greeted by six (6!) 56V ARC Lithium batteries from electric outdoor brand EGO. Those removable batteries can be swapped out of the Z370RS for fresh ones in seconds, getting you back to work in less time than it takes to gravity pour a tank of gas.

And, because they’re EGO batteries, they can be used in any 56V-powered EGO-brand tools and minibikes for unprecedented cross-brand interoperability. Tools and minibikes that, it should be noted, can be purchased at John Deere dealers across the country.

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The upsell scripts write themselves, kids. And when you start your dialing, tell your prospective customers their new Z370RS Electric ZTrak electric mower lists for $6,499, and if you order now we can bundle it with EGO minibike for the kiddos – just in time for the holidays!

Electrek’s Take

When John Deere launched the first Z370R, Peter Johnson wrote that electrifying lawn equipment needs to be a priority, citing EPA data that showed gas-powered lawnmowers making up five percent of the total air pollution in the US (despite covering far less than 5% of the total miles driven on that gas). “Moreover,” he writes, “it takes about 800 million gallons of gasoline each year (with an additional 17 million gallons spilled) to fuel this equipment.”

It should go without saying, then, that states like California, which are banning small off-road combustion engines, have the right idea.

SOURCE | IMAGES: John Deere.

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