Equinor Sverdrup Escapes Shutdown as Oil Workers' Strike Ends

Equinor ASA’s EQNR Johan Sverdrup facility, the largest oil field of Norway, has precluded itself from shutting down the production as the country’s oil workers called off a strike. The 10-day strike, which sealed about 8% of Norwegian oil and gas production, ended last Friday after the nation’s oil companies reached a wage accord with the labor union. Notably, since the news announcement on Oct 9, the price of West Texas Intermediate (WTI) crude declined more than 2%.

Following the wage bargain, production is likely to be restored at six offshore oil fields that were shutdown due to the strike. The deal will also prevent additional seven oil and gas fields from production shutdown. Notably, if the labor union fails to reach the accord, the strike by the Lederne union could reportedly multiply the total cut in daily production, considering the shutdown at the Sverdrup facility and other oil fields, to roughly 934,000 barrels of oil equivalents.

Equinor’s Johan Sverdrup oil field has a productive capacity of about 460,000 barrels of oil per day. Despite protesting at the Sverdrup field by 43 Lederne labor union members, the integrated oil major successfully retained its production with its remaining workforce, per the company. The Norwegian Organization of Managers and Executives (“NOME”) had called the strike that had been pressurizing companies to come to terms with the collective deal for the members whose jobs have been replaced from off the coast to onshore.

Company Profile & Price Performance

Headquartered in Stavanger, Norway, Equinor is one of the premier integrated energy companies in the world, with operations across 30 countries. Apart from oil and gas, the company is trying to capitalize on the growing renewable energy space so that it could align its operations with the Paris Climate Agreement. Its shares have outperformed the industry in the past six months. The company’s shares have gained 12.9% against the industry’s 19.3% decline.



Zacks Rank & Other Stocks to Consider

Equinor currently flaunts a Zack Rank #1 (Strong Buy). Some other top-ranked players in the energy space are Plains Group Holdings LP PAGP, Range Resources Corporation RRC and Laredo Petroleum Inc. LPI, each currently sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Over the past 60 days, the Zacks Consensus Estimate for 2020 earnings for Laredo Petroleum it has been increased by 11.3%.

Plains Group is expected to see earnings growth of 160.6% in 2021 whereas Range Resources is likely to see an earnings growth of 2905% in 2021.

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