TotalEnergies reported a net profit of $15.8 billion for 2024, a 26% decline from the previous year, primarily due to falling energy prices and reduced refining margins. CEO Patrick Pouyanné noted a challenging market influenced by post-COVID price drops and the Ukraine conflict. The company plans to reduce its investment in low-carbon initiatives while increasing spending on hydrocarbons, drawing criticism from environmental groups. TotalEnergies also aims for a dual listing in New York and is focusing on land-based renewable projects in the U.S.
TotalEnergies Reports Financial Results for 2024
On February 5, TotalEnergies unveiled its financial performance for the year 2024, revealing a net profit of $15.8 billion (€15.2 billion). This represents a 26% decrease compared to the previous year’s figures. The downturn is largely attributed to a challenging market environment characterized by declining energy prices and significantly reduced refining margins.
Despite the notable drop from the record profits of 2022 (€19 billion) and 2023 (€19.8 billion), TotalEnergies’ financial results remain fundamentally strong. In fact, the company announced a 7.6% increase in dividends for shareholders, signaling a robust financial health.
CEO Insights and Investment Strategy Changes
Patrick Pouyanné, the CEO of TotalEnergies, highlighted that 2024 was impacted by a “less favorable oil and gas environment.” Following the post-COVID price surge and the conflict in Ukraine, energy prices have begun to fall, which has had a direct influence on the group’s profitability. This trend is not unique to TotalEnergies, as other European energy giants like BP and Shell have also faced similar profit declines.
Looking ahead, TotalEnergies forecasts an average barrel price of $70 for 2025, a projection that Pouyanné describes as “a bit cautious.” Additionally, the company expects a notable increase in gas prices, which may help counteract the current downturn in oil margins.
One of the most talked-about aspects of the announcement is the company’s investment strategy. TotalEnergies plans to cut its budget for low-carbon energy initiatives by $500 million, reducing it from $5 billion to $4.5 billion for 2025. This decision signals a slowdown in the energy transition, mirroring similar reductions made by other major oil companies since 2023.
The company is opting to invest significantly in hydrocarbons, allocating one-third of its budget to new oil and gas projects. This move contradicts recommendations from the International Energy Agency (IEA) and the projections from the World Energy Outlook 2024 report, which suggests that by 2030, half of the world’s electricity should be generated from low-carbon sources.
The decision has drawn sharp criticism from environmental groups. Sarah Cleaver, Climate Campaign Manager at Greenpeace France, condemned the “limitless greed of polluting companies like TotalEnergies,” arguing that the group is prioritizing profitability over the well-being of the planet.
Furthermore, TotalEnergies confirmed its intentions to pursue a listing in New York, while keeping Paris as its main market. The group plans to convert its American Depositary Receipts (ADRs) into shares, facilitating trading on both markets, which could happen later this year.
In terms of future investments, TotalEnergies remains committed to developing renewable energy projects in the United States. However, the company believes that offshore wind initiatives will not receive authorization for at least four years, prompting a focus on land-based renewable energy projects that benefit from a more stable regulatory environment in the U.S.