Equinor faces billion-dollar loss from gas contracts

Record-high prices are not only a benefit for Europe's second-largest gas producer, which lost roughly USD 1.5bn last quarter on executing existing gas contracts.

Beyond losing on gas contracts, Equinor also announces zero output from the Snøhvit field because of the LNG terminal fire in Melkøya, Norway. Operation is set to resume on March 31. | Photo: Norsk Petroleum

When prices go up on a company's product, it usually benefits the business. Perhaps that's not the sort of trade secret that only emerges when rummaging through the estate papers of a deceased tycoon. However, that's not always the case, as is shown by Equinor's fourth-quarter interim report and its upcoming full-year statement set for release on Feb. 9.

Here, the Norwegian oil company – Europe's second-largest supplier of the now-historically pricey natural gas – is to book a loss of roughly USD 1.4-1.5bn on gas deliveries; or mere precisely, physical delivery of gas contracts settled at an earlier time when prices were several times lower, as well further losses on derivatives on contracted gas futures.

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