Oil Updates — Crude gains; TotalEnergies to buy stakes of Clearway; Petrobras shares drop following CEO ouster

Oil Updates — Crude gains; TotalEnergies to buy stakes of Clearway; Petrobras shares drop following CEO ouster
Oil Updates — Crude gains; TotalEnergies to buy stakes of Clearway; Petrobras shares drop following CEO ouster

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Jeddah - Yasmine El Tohamy - RIYADH: Oil prices rose more than $1 on Wednesday, buoyed by tight supplies and the prospect of rising demand from the upcoming start of the summer driving season in the US, the world’s biggest crude consumer.

Brent crude futures for July rose $1.38, or 1.2 percent, to $114.94 a barrel by 0511 GMT. Brent futures gained 0.1 percent on Tuesday and are up for the fifth day.

US West Texas Intermediate crude futures for July delivery rose $1.35, or 1.2 percent, to $111.12 a barrel. The contract settled down 52 cents on Tuesday.

TotalEnergies to buy 50 percent of US renewables firm Clearway

TotalEnergies said on Wednesday it has agreed to buy 50 percent of Clearway Energy Group, the fifth-largest renewables company in the US, marking the French group’s largest US renewables energy acquisition.

TotalEnergies has been branching out into the fast-growing renewable energy sector and diversifying away from hydrocarbon-centered activities in recent years.

The company said the acquisition would see it team up with Global Infrastructure Partners. As part of the deal, GIP will receive $1.6 billion in cash and an interest of 50 percent minus one share in the TotalEnergies subsidiary that holds its 50.6 percent ownership in SunPower Corporation.

The transaction takes into account valuations of $35.1 per share for Clearway Energy and $18 per share for SunPower, TotalEnergies added.

“It allows TotalEnergies to scale up in the US market, one of the most dynamic in the world, benefiting from operating assets and a 25 GW high-quality pipeline, in wind, solar and storage, with a wide geographic coverage with a presence in 34 states,” said TotalEnergies Chairman and CEO Patrick Pouyanne.

Petrobras shares drop

Shares of Brazil’s state-run oil company Petrobras plunged on Tuesday after the government ousted its chief executive for the second time in two months and signaled plans to alter the company’s market-based fuel pricing policy.

President Jair Bolsonaro has railed against a series of fuel price increases by Petrobras, formally known as Petroleo Brasileiro SA, which have tracked a surge in global energy costs and added to double-digit inflation in Brazil.

While the company has limited political interference during much of Bolsonaro’s term, his government has adopted a far more aggressive stance on fuel prices as the war in Ukraine drags on and Brazil’s October presidential election approaches.

Preferred shares in the company fell 4.7 percent in Sao Paulo in afternoon trade, far worse than a 1.2 percent slide for Brazil’s benchmark Bovespa equities index.

Bolsonaro’s chief of staff Ciro Nogueira said on Tuesday that the president is “anguished” by rising fuel prices and the company’s pricing policy must now be aligned with the views of a new energy minister, who took office this month.

(With input from Reuters)

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