# Equinor posts record profit boosted by soaring gas
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-10-28
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Equinor Smashes Q3 Profit Forecast Amid European Gas Price
Meta Description: Discover how Equinor's forecast-beating earnings were driven by European gas prices and higher dividends, with output adjustments for 2022.
URL: https://financedigest.com/equinor-posts-record-profit-boosted-by-soaring-gashtml

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By Nerijus Adomaitis and Nora Buli

OSLO (Reuters) – Equinor on Friday posted forecast-beating record profits for the third quarter driven by all-time-high European gas prices amid the Ukraine war, and said it would raise its dividend payment while reducing full-year output guidance.

The oil and gas producer’s adjusted earnings before tax for July-September rose to $24.3 billion from $9.77 billion a year earlier, beating the $23.5 billion predicted in a poll of 26 analysts compiled by Equinor.

The Russian war in Ukraine has changed the energy markets, reduced energy availability and [increased prices,”](https://www.financedigest.com/syngenta-4q-profit-falls-as-raw-material-prices-increase.html "Syngenta 4Q profit falls as raw material prices increase") Chief Executive Anders Opedal said in a statement.

High production combined with continued high [price levels resulted](https://www.financedigest.com/immediate-lift-of-oxford-property-prices-to-result-from-new-direct-high-speed-rail-connection-with-london.html "“Immediate lift” of Oxford property prices to result from new direct high speed rail connection with London") in very strong financial results.

The company, majority-owned by the Norwegian government, this year became Europe’s largest supplier of natural gas as Russia’s Gazprom [cut deliveries](https://www.financedigest.com/tesla-posts-record-quarterly-deliveries-after-price-cuts-up-4-from-q4.html "Tesla posts record quarterly deliveries after price cuts, up 4% from Q4") amid the West’s support for Ukraine.

Equinor’s previous earnings [record amounted to a profit](https://www.financedigest.com/bp-makes-record-profit-in-2022-slows-shift-from-oil.html "BP makes record profit in 2022, slows shift from oil") before tax of $18 billion and was set in the first quarter.

It now [expects its output](https://www.financedigest.com/uk-manufacturers-expect-output-to-fall-3-2-in-2023.html "UK manufacturers expect output to fall 3.2% in 2023") to grow by 1% in 2022 compared to last year, down from a previous projection of 2% growth, the company said.

Equinor lifted its extraordinary dividend, paid as a result of high [oil and gas prices](https://www.financedigest.com/oil-prices-stable-heading-for-weekly-gain.html "Oil prices stable, heading for weekly gain"), to $0.70 per share for the third quarter from $0.50 in the second, corresponding to an increased payment of about $640 million.

The company kept its regular quarterly dividend payment at $0.20 per share and maintained [plans for share buybacks of $6 billion](https://www.financedigest.com/eu-seeks-clarification-on-italy-post-covid-plan-freezes-19-billion-euros.html "EU seeks clarification on Italy post-COVID plan, freezes 19 billion euros") in 2022.

[Europe’s benchmark TTF front-month wholesale gas contract soared to a record](https://www.financedigest.com/u-s-oil-exports-to-europe-hit-record-in-march-on-steep-discounts.html "U.S. oil exports to Europe hit record in March on steep discounts") 343.08 euros per megawatt hour (MWh) in August, but has since fallen to 106.5 euros/MWh due to falling demand, full storages, mild weather and rising supply of LNG.

It remains more than four times higher than before [Russia began to throttle supplies](https://www.financedigest.com/exclusive-kazakh-mcdonalds-shut-outlets-temporarily-after-halting-supplies-from-russia-sources.html "Exclusive-Kazakh McDonald’s shut outlets temporarily after halting supplies from Russia – sources") last year.

Equinor has said it sells most of its gas [output on a day-ahead or month-ahead price](https://www.financedigest.com/oil-prices-take-a-breather-opec-sticks-to-output-plans.html "Oil prices take a breather, OPEC+ sticks to output plans") basis.

Of course, the (gas) [prices in Europe](https://www.financedigest.com/analysis-runaway-prices-have-central-europe-on-the-ropes.html "Analysis-Runaway prices have central Europe on the ropes") are very high. We have offered [long-term contracts](https://www.financedigest.com/hermes-secures-long-term-contract-extension-with-kingstown-associates.html "Hermes secures long-term contract extension with kingstown associates") to make sure we can have commercial deals that can keep prices more stable,” Opedal told Norwegian broadcaster NRK.

The European Union has said it [plans to coordinate some of its gas purchases in the hope of bringing](https://www.financedigest.com/austria-plans-to-bring-budget-deficit-within-3-of-gdp-next-year.html "Austria plans to bring budget deficit within 3% of GDP next year") down prices.

We will cooperate with those [buying institutions planned in the EU and negotiate gas prices](https://www.financedigest.com/4-for-the-price-of-1-what-you-can-buy-in-the-uks-top-northern-cities-for-the-price-of-a-london-pad.html "4 for the price of 1: What you can buy in the UK’s top northern cities for the price of a London pad") in the future,” Opedal said.

The Norwegian company, which makes most of its profit from production in its home country, [paid $17 billion in taxes](https://www.financedigest.com/walmart-paid-most-of-1-billion-tax-for-phonepe-shifting-base-to-india.html "Walmart paid most of billion tax for PhonePe shifting base to India") during the third quarter and is not subject to additional windfall payments to the government, which owns 67% of the shares.

Equinor’s net profit for the quarter amounted to $6.72 billion, while larger [European rivals Shell and TotalEnergies on Thursday each reported](https://www.financedigest.com/european-governments-spend-half-a-trillion-euros-on-energy-crisis-report.html "European governments spend half a trillion euros on energy crisis – report") profits of more than $9 billion.

Equinor’s Oslo-listed stocks have risen 59% year-to-date, outperforming a 24% [rise in European](https://www.financedigest.com/european-banks-cash-in-on-rising-rates-as-clouds-gather.html "European banks cash in on rising rates as clouds gather") petroleum stocks thanks to its big reserves of gas.

(Reporting by Nerijus Adomaitis and Nora Buli; Editing by Terje Solsvik and William Mallard)


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