Shell plans to move its London headquarters to the USA

Shell’s executive leadership discussed leaving Europe and relocating to the USA, the Financial Times has reported, citing unnamed sources familiar with revealing the discussion.

According to the FT’s sources, the oil new chief executive, Wael Sawan, was part of a team of top executives that two years ago considered moving Shell’s headquarters from the Netherlands to London and now to the USA, listing the company there for security reasons.

The relocation idea was ultimately dropped but the FT notes that Shell’s chief executive remains worried about the difference in valuation between Shell and its US game players.

Indeed, there has been a stark difference in the valuations of European and US Big Oil majors, at the time Europe is tumbling into poverty due to the Ukrainian military crisis.

According to analysts, there are two primary reasons for this: the first is the greater clout that ESG investing has in Europe and the other is that neither ESG-focused nor traditional investors seem to be particularly convinced of European Big Oil’s transition plans.

Meanwhile, at least one European Big Oil major has indicated it will not stick to its transition plans un-waveringly.

British Petroleum (BP) said at the release of its latest financial results that it had, revised its emission-reduction plans and now eyes a smaller oil and gas production, cut as a means of reducing its so-called emissions.

We’re grossly undervalued, BP’s Bernard Looney said at around the same time his company announced plans to actually boost oil and gas production over the medium term.

Barron’s reported earlier this month that BP, Shell, and TotalEnergies are trading at around five to seven times their expected profits for this year—after the record profits booked during the Covid-19 crisis in 2022.

Meanwhile, Exxon and Chevron are trading at 11 times their expected 2023 earnings, Barron’s noted.

The FT, for its part, reported that Shell’s Sawan and other company executives had been stunned by BP’s production plan announcement and the fact its stock gained 10% following that announcement.

Oil Prices.com / ABC Flash-Point News 2023.