Big Oils: Oil Price Implied In Eu Big Oils And Sensitivities On A Potential Hormuz Re-opening

This report analyzes the valuation sensitivities of EU Big Oils to Brent oil price changes, identifying a long-term implied price of $60/bbl for an 8% FCF yield. It highlights BP, Repsol, and Galp as top investment picks amid current market volatility.

Key Takeaways

• 1.EU Big Oils are pricing a long-term Brent of $60/bbl to reach an 8% FCF yield, which is a significant discount to Bloomberg consensus and forward expectations.
• 2.Upside is limited for consensus earnings, as current market pricing assumes higher 2026 and 2030 Brent prices compared to GSe projections.
• 3.Top stock picks for superior upside in the current macro environment are BP, Repsol, and Galp.

Table of Contents

• BIG OILS
• Sensitivities to Brent for the EU majors
• An 8% FCF yield implies a long-term Brent price at 60$/bl for the EU majors
• 12-month price targets
• Disclosure Appendix