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Who is the winner? Global oil and gas giant's barrel of oil cost PK!

2023-11-17 16:34:06

The latest financial report shows that CNOOC has good cost control in the first three quarters, with a barrel of oil cost (full cost of barrel of oil) of US$28.37, a year-on-year decrease of 6.3%. Based on the results of the first half of this year’s financial report, the cost of barrel of oil was US$28.17, analysts pointed out that CNOOC is expected to control the cost of barrel of oil below US$30 again in 2023.
Low cost has become the core competitiveness of oil companies and the key to improving profitability and combating the risk of oil price fluctuations. Faced with many unstable factors in the current international crude oil market, global oil companies are scrambling to reduce costs and improve efficiency, try to reduce unnecessary capital expenditures and strictly control operating costs - because this is the only way for companies to survive and fully prepare for future development. Metrics.

The cost of a barrel of oil for foreign giants

In the second half of the year, international oil prices fell from highs, and the net profits of the three international oil and gas giants Total, Chevron, and Exxon Mobil generally declined in the third quarter, recording adjusted net profits of US$6.45 billion, US$5.72 billion, and US$9.07 billion respectively. Compared with the same period last year, they decreased by 35%, 47% and 54% respectively.
The situation is pressing, and the cost of a barrel of oil is an eternal development indicator for large international oil companies.

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In recent years, Total has continued to strengthen cost control, and its break-even point has dropped from US$100/barrel in 2014 to the current US$25/barrel; BP's average production costs in the North Sea have also dropped from a peak of more than US$30 per barrel in 2014. to below $12 per barrel.
However, oil giants such as Total and BP have a wide range of global investments, and the cost gap between offshore, onshore and shale is huge. ExxonMobil has said it will reduce the cost of oil extraction in the Permian to about $15 per barrel, a level only found in giant oil fields in the Middle East, but other independent shale companies in the Permian do not have such good data. .
According to a Rystad Energy report, only 16 U.S. shale oil companies have an average cost of new wells in the Permian Basin below $35 per barrel; Exxon Mobil aims to increase production in the region fivefold by 2024. Reaching about 1 million barrels per day, the company can earn a profit of $26.90 per barrel there.
According to the 2023 semi-annual report, the cost of a barrel of oil for Occidental Petroleum's U.S. shale oil project is approximately US$35. Reuters reported that as the drilling depth of the U.S. Gulf of Mexico migrates from diving to deep water, the cost of a barrel of oil in the region will also rise from about US$18 to about US$23 from 2019 to 2022. According to information from Russia's authoritative pricing agency, the cost per barrel of Urals crude oil shipped from ports on the Baltic Sea is about US$48.
Comparing the cost of barrels of oil among major companies, CNOOC still has a price advantage over international oil companies such as Total, Exxon Mobil, and BP.

Low cost is the core competitiveness

Comparing the financial reports of "Three Barrels of Oil" in the past two years, CNOOC's gross profit margin is as high as over 50%.
With a net profit margin of 35%, unique profitability and low cost, it has become CNOOC's core competitiveness.
The financial reports of the past four years show that in 2019, CNOOC successfully controlled the cost of barrels of oil below US$30 (US$29.78/barrel). In 2020, it hit a new low in the past ten years, falling to US$26.34/barrel, especially in 2020. In the first half of the year, CNOOC's barrel oil cost reached a surprising US$25.72/barrel, and will be US$29.49/barrel and US$30.39/barrel in 2021 and 2022 respectively. This does not include foreign markets. You must know that the cost of a barrel of oil from CNOOC's Guyana and Brazilian oil fields is even lower, only about US$21.