| WTI Crude | $41.46/bbl | +0.6% |
| Brent Crude | $43.39/bbl | +0.2% |
| HH Nat Gas | $1.85/MMBtu | +4.5% |
| MB Propane | $0.51/gal | -1.3% |
| 3:2:1 Crack | $10.16/bbl | -3.5% |
Dow to cut jobs due to COVID-19
Michigan-based chemical corporation, Dow, has announced a 6% reduction in its workforce (2,000 people) due to the impact of COVID-19. The earnings report also disclosed that they will be taking actions to exit uncompetitive assets (like the rail assets mentioned a couple of weeks ago).
Why are they doing this?
Dow's CFO stated in a post-earnings call that "[they] are in the beginning phases of what is likely to be an uneven recovery,". They hope to reduce their expenses in 2020 by $500 million compared to last year. As hard as it is, eliminating these jobs will help Dow meet that target.
Bigger picture:
Dow is not the only company taking these actions. German chemical giant BASF announced a month ago that they will be eliminating 5% of their workforce (6,000 people). Schlumberger just cut 20% of its workforce (21,000 people). There are rumors about ExxonMobil as well.
Read more about Dow's announcement here on MLive.
Solvay to power peroxide plant with solar
Belgium's specialty chemical company, Solvay, is set to have 6500 MWh of solar panels at their peroxide site operational in the Netherlands sometime in August. The solar panels will contribute 40% of the plant's energy needs, and reduce their CO2 emissions by 17%.
Solar power is more complicated...
On a sunny day, 33% of the power generated from solar panels is enough to power the plant. All of that excess power generated by the solar panels will be fed to nearby homes. Conversely, when its cloudy 60% of the facility's energy will still need to be purchased from the grid.
Some context:
This isn't Solvay's first venture into solar power, but this is the first time the solar panels are actually connected to the plant. In March 2017, Solvay purchased 15-years worth of Renewable Energy Certificates (RECs) from a solar farm they built in South Carolina (hype video here). By purchasing those RECs they can say that their plant in Baton Rouge, that doesn't literally run on renewable energy, is powered by a solar farm.
Read the press release here.
Equinor made a profit, but there's more to come
Norwegian energy giant, Equinor, announced their Q2 earnings last Friday, and it wasn't nearly as bad as expected. Analysts were anticipating a loss of $200 million, but they ended up with a surprise profit of $350 million in adjusted earnings before interest and tax (EBIT). Still, that profit is down 89% from last year's Q2 profit of $3.15 billion.
Why were the analysts so wrong?
Equinor's CEO said in a statement that the financial results were a result of "very low realized oil and gas prices due to the pandemic, but also by a strong trading performance in volatile markets,". In those volatile markets, Equinor's commodity trading division was able to exploit the collapse in the value of short-term contracts.
What about other oil majors?
Total, Shell, ConocoPhillips, ExxonMobil, and Chevron will all be reporting their quarterly earnings this week. Kathy Hipple, and analyst at the Institute for Energy Economics and Financial Analysis (IEEFA), told CNBC that she thinks "it is going to be brutal and ugly". We'll have to see how bad it really ends up being.
Read more about Equnior's earnings here on Reuters.