石油与天然气行业分析报告2022年1月（1份）bg22113

HSBC-全球石油和天然气行业-全球综合石油-2022.1.18-39页.pdf

 4Q results will once again highlight the strength of sector freecash flows, but concerns over the energy transition persist

 Sector performance driven more by spot crude prices than byany fundamental re-rating, which could provide downside risk

 Raising target prices and estimates. Buy ratings reiterated onShell and Total

The integrated oils have had a strong start to 2022, with the sector outperforming broader markets by 9% ytd. Fundamentals are extremely robust, but we areconcerned this rally owes as much to the 9% rally in crude prices year-to-date as itdoes to any fundamental re-rating. It looks very similar to September/October, whenoil rallied 18% and the sector by 17%.

Strong results, again: 4Q results in the coming weeks will reinforce just how strongindustry fundamentals are. Sector cash flows should be similar to 3Q and nearly 50%above 2019 (pre-pandemic) levels, while capex is trending ~30% lower.

Bumper cash payouts: With balance sheets now largely repaired the outlook forcash distributions is very healthy. At USD75/b Brent we forecast average free cashyields of ~11% in 2022e and ~9% in 2023e (the latter on lower gas prices and highercapex), translating into average distribution yields (dividends plus buybacks) of ~8%.

Climate concerns won’t abate: We continue to believe historical valuations arelargely irrelevant given the scale of company transformation which will take place inthe coming years to adapt to the energy transition, and concerns over low-carbonreturns. We expect this to remain a substantial headwind to valuations.

Oil price risks: Despite market talk of possible further upside risk to crude prices, weare concerned that near-term downside risks could be greater as the oil marketmoves into oversupply in 1Q, and the sector looks susceptible to any such downside.See our report Oil in 2022: It’s not all upside (14 January 2022).

Higher estimates, TPs: We raise 2022 cash flow estimates by an average of 7%,mainly on higher gas prices. With this, our target prices rise by an average of 9%, butafter the sector rally the average upside implied is only ~10%. We reiterate Buy ratingson Shell and Total and Holds on BP, CVX, ENI, EQNR and REP.