[ET Net News Agency, 14 September 2018] With Brent rising to a four-year high of US$80
and likely to continue to trend up in 4Q on potential supply risks in Venezuela and Iran
and seasonal heating demand in the US, the earnings trends of upstream and downstream will
diverge should Brent rise across US$80, according to Nomura.
The research house said CNOOC (00883), as a pure E&P company, will be best positioned
for a >US$80 Brent environment.
Nomura said E&Ps will continue to benefit from their leverage to higher oil prices, but
incremental opearting profit/bbl would be lower with the progressive tax rate of the
windfall tax.
It estimated thresholds of windfall tax (Brent) to be US$71, US$73 and US$69 for
PetroChina (00857), Sinopec (00386) and CNOOC, respectively, given US$3.6-7.7/bbl of
discounts to Brent. Nomura expects them to pay US$2.3/1.6/2.7 per bbl of windfall tax at
US$80 of Brent, and higher tax should oil prices continue to rise. (KL)
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00857 PETROCHINA
Nominal 
7.480 +0.160 (+2.186%) Others
14/09/2018 11:42
[I-bank focus]Risks of crude refining margins to emerge
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