PARIS, October 15, 2025 — French energy giant TotalEnergies SE (TTEF.PA) announced on Wednesday that it expects improved third-quarter financial results, driven by higher oil and gas production and stronger refining margins, even as lower oil prices and reduced liquefied natural gas (LNG) output weighed on performance.
In its third-quarter trading update, the company said results and cash flow from business segments are projected to increase between 0% and 5% year-on-year, supported by steady hydrocarbon growth and exceptional downstream performance.
“Despite a $10 per barrel decline in oil prices compared to last year, TotalEnergies anticipates stronger overall results, underscoring its balanced energy portfolio,” the company said in a statement.
Refining Margins Surge 300% on Diesel Demand and EU Ban on Russian Oil
TotalEnergies’ performance was buoyed by a sharp increase in European refining margins, which averaged $63 per ton in the third quarter — a 300% rise compared with the same period in 2024.
The surge was largely attributed to robust diesel demand during the summer driving season and reduced fuel supply caused by the European Union’s ban on Russian oil products.
This improvement is expected to boost downstream earnings by $400 million to $600 million year-on-year, according to the company’s projections.
“European refining profitability has soared, reflecting resilient demand dynamics and structural supply shifts since the EU’s import restrictions on Russian fuels,” analysts said.
Upstream Production Strengthens as TotalEnergies Increases Output
The company expects upstream oil and gas production to climb 4% year-on-year to 2.5 million barrels of oil equivalent per day (boe/d) in the third quarter — exceeding its earlier annual guidance.
This rise in production highlights TotalEnergies’ continued investment in strategic upstream projects across Africa, the Middle East, and offshore Europe, even as the global industry faces price volatility and energy transition pressures.
“Accretive hydrocarbon production growth remains a key contributor to TotalEnergies’ resilience amid market uncertainty,” the trading update noted.
LNG and Power Divisions Face Mixed Results
While oil output increased, the company’s Integrated LNG segment is expected to report lower results due to scheduled maintenance on two liquefaction units at the Ichthys LNG plant in Australia.
In contrast, the Integrated Power division continues to perform strongly, with results projected to match the second quarter’s $574 million — representing an 18% year-on-year increase.
TotalEnergies has been expanding its renewable and electricity businesses as part of its energy transition strategy, with investments in solar, wind, and battery storage projects across Europe, Africa, and Asia.
Gearing Ratio Expected to Improve Amid Debt-Reduction Focus
Following approximately $3.5 billion in acquisitions during the first half of 2025, CEO Patrick Pouyanné pledged to strengthen the company’s balance sheet through asset disposals and stronger cash generation from retail power and refining operations.
As a result, TotalEnergies’ gearing ratio — a measure of debt relative to equity — is expected to improve by 0.5 to 1 percentage point from the 17.9% recorded at the end of Q2 2025.
The company said it plans to divest around $500 million worth of non-core assets during the third quarter, offsetting new investments and helping fund share buybacks and dividend payments.
Oil Prices Weigh on Revenues but Market Outlook Remains Balanced
During the July–September period, Brent crude oil prices averaged $69.10 per barrel, down 14% year-on-year, reflecting weaker demand forecasts and a softening global economy.
Analysts expect prices to remain under pressure through 2026 as major oil producers, including OPEC+, unwind output cuts and U.S. shale supply rises.
“TotalEnergies remains strategically well-positioned despite price headwinds, thanks to its diversified energy mix and disciplined investment strategy,” said energy analyst Mathias de Rozario.
TotalEnergies Eyes $3 Billion in Net Investments for Q3 2025
For the third quarter, TotalEnergies’ net investments are expected to reach around $3 billion, factoring in $500 million in divestments net of acquisitions. The company continues to prioritize capital discipline while maintaining commitments to shareholder returns and energy transition initiatives.
Shares of TotalEnergies were up 2.3% at 0723 GMT, reflecting investor optimism over stronger refining performance and improving financial indicators.
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