COM - Jefferies upgrades Repsol downgrades Total - Shell remains top pick

Jefferies analyst Giacomo Romeo upgraded Repsol (OTCQX:REPYY) to buy Wednesday, citing an improved outlook for European refining margins and valuation. In the same note, Total (TTE) was downgraded to hold, as Russian upstream exposure and French political risk outweigh the improved macro environment. The analyst maintained Shell (SHEL) as a top pick, citing the long-term impact to gas markets from the current energy crisis. Jefferies assumes Brent oil (CO1:COM) will average ~$91 in 2022, and sees European majors generating ~21% free cash flow yields this year.

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Jefferies upgrades Repsol, downgrades Total - Shell remains top pick