The big themes on Big Oil’s mind in Oil & Companies News 26/02/2026 Big Oil’s big strategic goal is to strengthen upstream portfolios for the next decade (look out for our forthcoming February Horizons for deep analysis). The Q4 results released over the last fortnight added some colour to companies’ plans but also highlighted the need for corrective financial measures, given uncertain commodity markets. I chatted through the main themes from the results with our Corporate Analysis team. How does the industry see the outlook for commodities? The messaging is downbeat for the immediate future across almost the entire hydrocarbon complex – Brent, downstream (where refining is doing better than petrochemicals) and global LNG, with the growing consensus of an imminent glut is consistent with the WoodMac view. The strong production growth of TotalEnergies, Equinor, Chevron and ExxonMobil partly offsets the hit to their respective bottom lines from weaker prices. However, it’s no surprise that companies are emphasising renewed efforts to cut operating costs and trim investment. Why are some companies more positive about the US gas market? The argument is that the January surge in Henry Hub prices is a portent of a progressive tightening of fundamentals. Certainly, US gas demand will surge in the next few years, driven by data centre capacity build-out and new LNG export projects coming onstream. Our view is that higher-cost gas will need to be tapped to meet higher demand, pushing the price up to US$4.60/mmbtu (real) by 2030. How has the weak macro outlook affected shareholder distributions and balance sheets? Buybacks are being wound back in a big way, with low oil prices limiting free cash flow after dividends. Collectively, the Majors have spent US$285 billion – 18% of the combined market cap – in the four years from 2022 to 2025. That bountiful period is now at an end. Equinor announced a cut to its buyback, as did TotalEnergies, which is aiming to maintain gearing around its current 15%. BP ceased buybacks entirely to accelerate deleveraging and dropped its shareholder payout guidance. Expected full-year 2026 disposal proceeds totalling US$9 billion to US$10 billion will also support its net debt reduction. With a new Chair in 2025 and an incoming CEO (Meg O’Neill starts April 1st 2026) the company is shifting the investor story to a “unique, world-class” upstream opportunity set, built organically. A speedy strengthening of the balance sheet will provide the financial capacity to deliver. What’s the latest on upstream portfolio renewal? It’s the big theme strategically. Big Oil needs to avert declining production in the next decade, although the urgency to do so varies greatly by company. Shell, for one, was taken to task on its investor call about its weak post-2030 hopper. The challenge is substantial. To fill the gap, the Majors will need to use a combination of discovered resource opportunities (DROs), M&A and exploration. Access to DROs is gaining momentum. In Libya, TotalEnergies and ConocoPhillips have both signed 25-year contract extensions, Chevron is a new entrant. Iraq is on the radar as is Venezuela though TotalEnergies, however, has downplayed the latter because of high costs (our view is that new project breakevens are US$80/bbl (real) on current fiscal terms). M&A will inevitably play a part in portfolio building even if TotalEnergies observed that high-quality assets are expensive. Shell was candid about its willingness