GLPEY - GALP Q4 trading update - weak upstream volumes take shares lower

Galp (OTCPK:GLPEY) provided key trading metrics for Q4 ahead of the European open; net upstream production came in at 123kb/d versus consensus at 127kb/d, down 5% QoQ, while refining utilization fell on the back of increased maintenance. With Petrobras (NYSE:PBR) already reporting production for the year, the miss was largely driven by Angola, where volumes fell 5% year on year (2% QoQ). Angola has been a serial underperformer within OPEC+, and these results indicate the country was unable to improve volumes in Q4, despite higher quotas. Galp expects realizations to trail Brent pricing by $8-$10 per barrel, as natural gas increases its share of mix. Refining margins at $5.6 versus Q3 at $4.0 were a positive, and although the impact to Galp is muted, it provides a read-through for other Med refiner performance.

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GALP Q4 trading update - weak upstream volumes take shares lower