00:00Clearly, you put numbers out this morning, but the whole industry, the oil industry, energy industry, very much watching what
00:07is happening in the Middle East, I'm sure.
00:08So we'll start our conversation with your take on what's going on there.
00:14It's going to be difficult to make assumptions, I suppose, about where oil prices go, where gas prices go at
00:19this point.
00:20What kind of prices are you preparing the business for?
00:25Thank you, Anna. Thank you very much for having me.
00:27It is indeed quite a moment to be putting results out there.
00:32But what we have been doing is, in a way, to some extent, reflecting the fact that some of this
00:37has been in the horizon for a while.
00:40And so we have been preparing, I think, the results are testimony to the extent to which our own portfolio
00:46is prepared and what we see happening in the industry that we believe will now play out according to what
00:53we find in the scenarios as we move forward.
00:55So volatility has been the hallmark of the sector.
01:00And if anything, it is now fundamentally heightened.
01:04And I think with volatility and added uncertainty, what we believe is that prices are certainly going to have a
01:11very different pattern in the short term versus the long term.
01:14So we cannot help but be prepared for the short-term impacts.
01:19And we believe that will indeed be the impact of the conditions in the Hormuz trade.
01:26There will be just a general market reaction to the added uncertainty.
01:31General upward trends.
01:32Long term, let's see how the scenarios play out.
01:35But I think the timing and the duration of operations here will clearly be the hallmark.
01:43So higher pricing in both of those markets, clearly.
01:47Now, you do exploration production yourselves at GALP, but you also go into the market to buy those products, Maria.
01:54What's your assessment of how much product is going to be getting out through the Straits of Hormuz?
02:00I think it's still early hours we'll need to see.
02:03Obviously, very conditioned.
02:04I think for a company such as GALP, we're very focused in the Atlantic Basin.
02:09So in the very short term, the operational constraints in the Hormuz trade will not be a fundamental constraint.
02:16And I'm sure other players were also watching the instability in the region and adjusting their portfolios.
02:23For us, what we have been trying to do is precisely look at the portfolio, diversify our clients, and with
02:33that, address the risk profile that obviously has been going up in the market.
02:39So let's see how long the constraints in the Straits last.
02:44Those will, of course, have an impact on economics.
02:47The way we have sought to address that, those impacts has been fundamentally about preparing for the longer term
02:54and addressing the way our portfolios and our baskets are composed.
03:00Maria, how vulnerable potentially is Europe to an oil or gas shock at this point?
03:07I think we've been seeing Europe react very differently after the prior gas shocks.
03:13So what we're seeing right now is that, and if you're looking at the market these days,
03:18a lot of this has to some extent been foreseen or at least adjusted in the risk scenarios that the
03:27market in general
03:27and companies such as ourselves have been looking at.
03:30So obviously, the instability is adding to what is already a trend.
03:35But we do believe that not just companies such as ourselves, but the sector as a whole is far better
03:43prepared.
03:43I think when we look at the balance in terms of origination, what we look at the sources,
03:50when we look at the stocks that we are now seeing in the market,
03:53those speak to better preparation, speak to an effect, an ability to manage the long term.
04:00That was not there a couple of years ago when we had the first impact from the Russian strikes on
04:06the train.
04:08Maria, just on your earnings, fourth quarter adjusted EBITDA missing estimates.
04:13What are the main risks you see ahead for this year, apart from the obvious that we've just discussed?
04:18And how will dollar strength, if it persists, affect you?
04:24We are indeed a company that is operating across a number of these commodities.
04:28So a lot of this will play out in the very short term.
04:32We have a relatively conservative outlook for the year.
04:36So a relatively strong euro and a relatively low Brent.
04:41So what we do expect is that as these play out,
04:45we will be able to continue to rely fundamentally on operational efficiency as we have been.
04:50So it's fundamentally about making sure that you have flexibility in your portfolios to adjust for the trading components
05:01and a lot of operational efficiency going on.
05:04So upstream continues to be the driver of our growth and our fundamental performance.
05:09And there is where we're seeing that continuing to be able to deliver goods,
05:16low cost spells to the market is at the core of our proposal.
Comments