Equinor eyes tighter gas market as lower oil prices hit Q2 profit

By Nerijus Adomaitis

OSLO (Reuters) -Europe's gas market could tighten further ahead of the winter season as storage levels remain well below last year and the continent faces competition from Asia for LNG shipments, the CEO of Norway's Equinor told Reuters on Wednesday.

Europe's biggest gas producer said the prospect of a rebound in pipeline gas flows from rival supplier Russia had also diminished in recent months, citing political opposition in Germany and elsewhere.

Equinor reported on Wednesday a 13% drop in second-quarter profits, as expected, as declining oil prices outweighed an increase in the price of gas in Europe and the United States.

The Norwegian energy group's adjusted earnings before tax for April-June fell to $6.54 billion from $7.48 billion a year earlier, in line with the $6.53 billion predicted in a poll of 21 analysts compiled by the company.

EU gas stores are currently 65.4% full, according to data from Gas Infrastructure Europe, down from around 83% at the same time last year.

"This can create a more tight (gas) market during the autumn or during the winter," CEO Anders Opedal told Reuters on the sidelines of Equinor's earnings presentation.

The supply situation remains dependent on factors such as the weather-related demand and production regularity, as well as imports from outside the region, he added.

"In June, we saw 25% less LNG ships into Europe compared to before, meaning that the competition tightens a little bit," Opedal said.

Equinor maintained a projection that its oil and gas output would increase by 4% this year compared to 2024 and kept its forecast for capital expenditure in 2025 of $13 billion.

The company on Wednesday booked a $955 million writedown on an offshore wind project in the United States, citing U.S. tariffs and the uncertainty of the regulatory environment under President Donald Trump.

In February, Equinor followed rivals such as Shell and BP in promising higher oil and gas output while scaling back investment in renewables, citing challenging market conditions for the green energy transition.

Equinor in the second quarter pumped 2.1 million barrels of oil equivalent per day (boed), slightly ahead of expectations in the analyst poll for 2.06 million boed, and up from 2.05 million boed a year earlier.

Equinor's share price was down 1% at 1145 GMT, lagging a 1.6% rise in the European energy stock index.

(Reporting by Nerijus Adomaitis, editing by Terje Solsvik)