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Bloomberg News reports that BP is considering selling its $10 billion Castrol lubricants division.
Bloomberg News, citing sources familiar with the situation, reported Tuesday that oil major BP was considering a possible sale of its lubricants division, Castrol. The deal could be worth $10 billion. The report stated that BP was considering a sale of its business. It also said that Elliott Management had identified the unit as a potential asset for disposal. Elliott declined to make a comment, and BP didn't immediately respond to a comment request. The report last week stated that Elliott was pushing the oil company, after acquiring a 5% stake in it, to take radical actions to transform its performance, including a large divestment program. It engages with the company ahead of Capital Markets Day scheduled for 26 February. Bloomberg reported that the company could announce its potential divestment at Capital Markets Day. The shares of BP were set to make their largest daily gain in the past two years on Monday after reports that an activist shareholder would push for board changes and strategic shifts in order for returns to increase. Last Wednesday, the company reported a 61% year-over-year drop in its fourth-quarter profit, the lowest period since 2020's fourth-quarter, when pandemic lockdowns lowered demand for oil. According to BP, Castrol is used by customers in more than 150 countries, including the automotive, maritime, industrial, aerospace, and energy production industries. Reporting by Devika Nair in Bengaluru, editing by Alan Barona
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As CEO promises accountability, Chevron employees are laid off in a long-awaited process.
A video was shown to Chevron's employees at a town hall meeting held last week. The video highlighted the success of the oil giant in Colorado, where it is the largest producer of oil and natural gas in the state. In less than 30 minutes, the executives announced their plans to reduce up to 20% of global staff. Chevron, despite progress made in safety and financial performance has fallen behind its competition, the company's leaders informed employees at a meeting held on February 12th. On the webcast, they stated that Chevron's business was becoming too complex, costs were creeping up, and it had difficulty making quick decisions. Review of presentation slides as well as a recording from the Town Hall that was broadcast to all staff members worldwide. Chevron plans to reduce its workforce by up to a fifth - or 8,000 employees - after oil prices have been in the 70-80-per-barrel range for the majority of the last year. The oil prices and the refining margins are lower than last year but enough to generate a profit of $18,3 billion for Chevron in 2024, down from $24.7billion in 2023. The layoffs are the culmination of a difficult 18 months for Exxon Mobil, the U.S.'s second largest oil producer. Exxon Mobil, along with CNOOC and Hess partners in Guyana challenged the deal at court. Arbitration is still pending on the deal. Four Chevron employees said the layoffs had been widely anticipated internally. Some employees even admitted that the move was needed to compete with Exxon, and other rivals. "I think this will be a positive thing," said an employee of Chevron, who asked to remain anonymous because they weren't authorized to speak in public. It's hard to go through, but we were the last major company (to make cuts). "Everyone was wondering when Chevron will do it." Chevron announced in November that it would aim to reduce costs up to $3 billion by 2026. This will include changing the way and where work is done. Chevron's spokesperson stated that changes in the company structure would improve efficiency and results. The spokesperson stated that "while these changes are needed, the decision to decrease our workforce is not easy." Shell, a UK-based oil company, planned to reduce its oil and natural gas exploration and production workforce by 20% in an effort to cut costs. This was reported in August. Last month, rival UK oil major BP announced that it would cut 3,000 contract positions and 4,700 employee jobs. Three Chevron workers said that they have experienced several rounds of layoffs in their careers due to the nature of the oil-and-gas industry. One of the employees said that layoffs during COVID-19 were even worse. The employee stated, "They always said it would be the last time." Due to China's rapid rise in electric vehicle sales, the world's biggest crude importer. This country has been driving the global oil demand for more than a decade. Nick Hummel is an analyst at Edward Jones and said that uncertainty about the global economy, China's demand, and oil prices could limit future oil prices. Mass layoffs are common in the oil sector after oil prices plummet. One Chevron employee was dismayed at the timing of layoffs in a time of relative price stability. The person who refused to reveal his name but identified himself as a Chevron employee said, "It's a biting feeling." "Oil prices appear stable, but then they drop the hammer." ACCOUNTABILITY Kim McHugh read out questions from employees during the town hall. Employees asked if Chevron executives will be held responsible for their company's poor performance. People feel that they are held accountable. "How is leadership held accountable?" McHugh stated. Mike Wirth, CEO of the company, said that he was looking for transparency and action from his leadership team. When things don't go well, do I get a nice excuse and a bunch of reasons, or do I get a plan?" He said. Wirth, in response to a second question, said that Chevron, as part of its efforts to simplify the business, will also clarify who has decision-making authority and hold them accountable. McHugh said that after several previous reorganizations staffers want to be reassured that the latest restructuring is successful. She told the CEO, "I believe the employees would like me to say that you've committed to give us simplicity." We don't want to have to do this again. Reporting by Sheila Dang in Houston, Ernest Scheyder in New York, Arathy Sommesekhar, Marianna Pararaga, and Nia William.
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Energy shares boost TSX as investors digest inflation data
Investors digested the news that inflation increased in January as they drove up Canada's main index of stocks. The Toronto Stock Exchange S&P/TSX Composite Index closed at 25,648.84, up 165.61 or 0.65%. As traders assessed the impact of drone attacks on an important conduit for Kazakhstan's exports, heavyweight energy prices rose by 1.4%. The traders were cautious, as the talks to end Ukraine's war could boost Russian supply. Financials added 0.8% as well, led by iA Financial & Royal Bank of Canada. Analysts at Bay Street expect big banks to report strong results for the first quarter next week. However, they note that the outlook is uncertain for the remainder of 2025 because of the risk of a trade war between the U.S. Materials rose by 1.2%, as the price of gold soared due to persistent demand for safe haven assets. Separately the annual inflation rate for Canada in January increased slightly from December to 1.9%. As shown by Tuesday's statistics, while the lower prices were a relief, they have been partially offset by higher costs for gasoline and natural gases. The yields on Canada's benchmark 10-year bond and 5-year bond reached three-week highs earlier in the morning, exerting pressure to the equities. Stephen Brown, Capital Economics' deputy chief North America economics, said that there is "clear evidence" of underlying inflation pressures building. We still believe that the Bank of Canada will cut rates next month despite the threat of tariffs hanging over the economy. However, it's a very close call. As global attention turned to developments in the Ukraine conflict between U.S. president Donald Trump and Vladimir Putin, the threat of tariffs receded. Fortuna Mining, on the other hand, lost 8.3% in value after CIBC lowered its rating to "underperform", from "neutral." CLICK CODES TO GET CANADIAN MARKETS UPDATES: TSX Market Report Canadian Dollar and Bond Report Global Stocks Poll for Canada Canadian Markets Directory (Reporting and editing by Shreya Biwas and Richard Chang; reporting by Pranav Kahyap and Nivedita Bali in Bangalore)
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US SEC asks India for help in Adani Fraud Probe
A court filing on Tuesday revealed that the U.S. Securities and Exchange Commission had requested Indian authorities' assistance in its investigation into Adani Group founder Gautam Adani and Sagar Adani regarding alleged securities fraud and $265 million bribery schemes. The SEC informed a New York District Court that its efforts were continuing to serve the complaint on Gautam and Sagar Adani and it was seeking assistance from India's Ministry of Law and Justice in order to serve this complaint. Both men are in India and neither is under U.S. custody. Adani Group did not immediately respond to an inquiry for comment. Outside of regular business hours, the Indian government was not immediately reachable. Federal prosecutors in Brooklyn unveiled an indictment last year accusing Adani bribing Indian government officials to persuade them to purchase electricity produced by Adani Green Energy, a subsidiary company of the Adani Group, and then misleading U.S. Investors by providing reassuring data about the anti-corruption policies of the company. Adani Group called the accusations "baseless," and promised to pursue "all legal remedies." (Reporting and editing by Lisa Shumaker; Kanjyik Kalra, Aditya Kalra)
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US EPA gives West Virginia authority over carbon capture
The U.S. Environmental Protection Agency granted West Virginia, the fourth such state to receive this authority, formal authority on Tuesday to oversee carbon-capture projects in the State. The agency has signed a final regulation granting West Virginia primary enforcement authority (also known as primacy) to allow so-called Class VI Wells to accelerate approvals and progress the development of massive Carbon Sequestration Projects. As one of my very first acts as EPA administrator, I'm proud to have signed this rule, which will allow West Virginia to be independent in regulating and granting permits, and also work to protect our environment and drinking waters, said EPA administrator Lee Zeldin. Carbon capture and storage (CCS) is a new technology that pulls carbon dioxide emissions out of industrial sources, before they can reach the atmosphere. They are then stored underground. The EPA has approved only a few of the carbon sequestration plans or projects that are in progress. North Dakota, Wyoming, and Louisiana have also been given the authority to supervise their own CO2 injection permits and oversight. Texas oil, gas, and industrial groups asked Zeldin last week to expedite the state's application for primacy. Texas is reviewing 43 projects, which represents one-third of the total number of U.S. applications. The 2022 Inflation Reduction Act of the Biden administration contains billions in subsidies. This includes a lucrative tax credit of $85 per metric tonne for storing carbon dioxide in geological formations. Energy experts believe that despite the President Donald Trump's vow to eliminate the IRA (Biden's landmark legislation on climate change), such subsidies are likely to survive because of strong support by Republican states and legislators. (Reporting and editing by Leslie Adler; Valerie Volcovici)
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Brazil resumes imports of energy from Venezuela after six-year hiatus
Brazil resumed imports of electricity from Venezuela to supply the northern state of Roraima after six years. The measure was taken in an effort to reduce costs and diversify energy supplies for consumers. The operation, approved by the Brazilian energy regulator Aneel on Tuesday, is intended to provide an alternative source of energy for Roraima. This is Brazil's sole state that doesn't receive its energy from the grid. Since the end of imports from Venezuela in 2019, Roraima consumers have been relying exclusively on local thermoelectric production, with fuel subsidised by a fund that is added to their electricity bills. Bolt Energy, a Brazilian trading company, has been authorized by the Brazilian government to import Venezuelan electricity at a rate of 1,096.11 Reis ($192.49 per megawatt-hour) valid from January through April. The state fund will reimburse the trading company for this operation. According to the National Electric System Operator, imports resumed on Saturday with a 15 megawatt limit. After a short interruption, the next day, operations resumed after the shutdown of a transmission link connecting Brazil and Venezuela. The issue had already been resolved, so the importation of energy from Venezuela was resumed. $1 = 5.6943 Reais (Reporting and writing by Leticia Furcuchima, Rio de Janeiro and Rodrigo Viga Gaier; editing by Leslie Adler).
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Trump's SEC chief shifts power away from investors and into boardrooms
Experts say that new policies by the U.S. Securities and Exchange Commission give corporate boards greater power over investors. This could limit investor-initiated efforts to reform everything from climate policy or director contests. Since the U.S. president Donald Trump appointed Mark Uyeda as acting chairman of the Securities and Exchange Commission last month, the agency has made a number of changes. They have increased the filing requirements for passive funds and limited the communication capabilities that investors can use. Attorneys say that the changes will give directors greater freedom to ignore efforts to limit emissions and report diversity in the workforce. Traditional activists who run their own director slates may also find it more difficult to challenge boards. Ann Lipton, a professor of business law at Tulane University, said: "It is a reallocation that is relatively dramatic. It's not only to make corporate policies but also to protect them against activists." Uyeda, along with other Republican officials, including Paul Atkins, Trump’s nominee to lead the SEC, have expressed their skepticism about environmental, social, and governance (ESG), investment considerations. Uyeda stated in a speech from 2023 that "shareholder meetings were never intended to be debating societies or political battlegrounds under state corporate law." A spokesperson for the SEC declined to comment upon being contacted. Atkins didn't respond to any questions posed by his current firm. Fewer ballot items The SEC changes are consistent with other Trump Administration efforts, such as the dismantling of diversity programs and withdrawal from the Paris Climate Agreement. ESG resolutions received significant support between 2021 and 2022 but have declined since. In a legal bulletin issued on February 11, the SEC encouraged companies to avoid voting on resolutions by claiming that the proposals would "micromanage" the businesses. This change could make the process of negotiating with executives difficult for activists who are interested in ESG. Rick Alexander, CEO at Shareholder Commons (which tracks and writes resolutions), said that it would be more difficult to carry out this kind of work if it was harder to get a resolution passed by the SEC. The SEC revised its "beneficial ownership" reporting interpretations on February 11, allowing firms such as asset managers BlackRock or Vanguard to rely more on SEC Schedule 13G forms to report their major holdings. The agency has tightened the rules on when managers may use the Schedule 13D form instead of the more complicated Schedule 13D which increases their costs. The SEC will now test if an organization "imposes pressure" on management, such as by tying director voting to the presence of a staggered or poison pill defense against takeovers. BlackRock and Vanguard both have policies on proxy voting that suggest these circumstances could lead critical votes. BlackRock and Vanguard declined comment. Caroline Crenshaw via email, the only Democratic member currently on the SEC said that the change may have a negative impact on the outreach of big funds. The interpretation confuses institutional investors with an unstated aim of discouraging them from engaging in business with corporations. Crenshaw stated that this policy was bad for capital creation. Communication Breakdown Thirdly, new guidelines have been issued on the use of electronic records by investors to send out "exempt solicitations" or communications between shareholders. Smaller investors have started to file their own exempt solicitations to express their opinions on certain issues, such as whether they should oppose a director or support a resolution by shareholders. In an update on January 27, the SEC restricted their use. The SEC stated that the documents "are not intended to be used as a means by which someone distributes written soliciting materials to security holders" but are only meant to inform the public about written materials sent through other means to security holders. Tom Quaadman is Senior Vice President of the U.S. Chamber of Commerce. This top business lobbying organization welcomed the SEC changes. He said: "You are seeing a rebalancing in SEC rules and policies that is designed to remove special interest activism, and to bring things back to an investor-focused focus." Reporting by Ross Kerber, Boston. Simon Jessop, London editor.
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Colombian Petro claims drug traffickers are threatening to kill him using missiles
On Tuesday, Colombian President Gustavo Petro said that drug traffickers had acquired two missiles, which they planned to fire on his plane in order to kill it. He cited the success of the efforts he has made to combat the drug trade. "You know they are going to fire a missile on my plane that the drug dealers have bought and stored," said Petro. Petro claimed that the missiles were not one but two, without providing any evidence. They were in the possession of Carlos Fernando Triana, the new director for Colombia's National Police. He added: "We know who these people are, but it's time to act." Without naming the group that might be behind this plot, he did not name any names. According to the Ministry of Defense, Colombian security forces have seized an unprecedented 883.8 tons of cocaine, up from 746 tons in 2023. The main causes of the six-decade conflict, which has claimed more than 450,000 lives, are cocaine production and trafficking as well as illegal gold production. Reporting by Luis Jaime Acosta, Writing by Oliver Griffin
What is in the EU draft Clean Industrial Deal?
A draft package was revealed on Tuesday by the European Commission. The package will be proposed next week to help EU industry stay competitive and reduce their carbon footprint.
The European manufacturing industry is facing a number of challenges, including a weak demand for its products, the cheaper Chinese competitors and upcoming tariffs by U.S. president Donald Trump on imports of steel and aluminum.
Here are the key elements of a leaked EU 'Clean Industrial Deal,' which is intended to revitalize Europe's struggling domestic industries.
Energy Prices
Energy prices in Europe are up to three-times higher than those of their American competitors, and Brussels has been under pressure to reduce this price differential to help local businesses to compete.
The draft EU document detailed plans for an European Investment Bank scheme that will launch by the end March. This scheme would offer guarantees to smaller companies for signing power purchase agreements, helping them lock in renewable electricity generators with predictable prices.
The EIB will also provide support to manufacturers who produce components for power grids to upgrade Europe's aging energy networks.
A proposed EU legislation in the fourth quarter would provide fast-tracked permits for energy-intensive industries in order to boost investment in clean industrial project.
The draft states that Brussels will recommend to all 27 EU member countries to lower electricity taxes to the legal minimum to reduce consumer bills on a short-term basis.
The Commission plans to also soften existing EU gas storage filling target, which the EU planned to extend past 2025. This is in response Germany and other countries who are concerned that fixed deadlines for filling storage could raise gas prices.
PUBLIC PURCHASING, STATE AID
The EU plans to make it easier for businesses to get state aids and other financial incentives when they undertake projects that reduce their carbon emission.
EU governments will be allowed to offer tax breaks on clean industrial investments through measures like accelerated depreciation. This allows businesses to depreciate a larger part of an asset sooner.
The draft stated that these changes will be made by simpler EU state aid regulations, which are due to be published in July. The EU will help countries to use national state aids to combat energy price spikes. This could include using subsidies to protect consumers from high gas costs.
Gas is the main source of electricity for most EU consumers, despite the rapid expansion of renewable energies in the EU.
In 2026, the EU's public procurement rules are set to be reformed. Buy-Europe criteria will be added in order to increase demand for local products.
Trade and CO2 Costs
According to the draft Clean Industry Deal, the EU will continue using anti-dumping and anti-subsidy duty as long as industries continue to be concerned about cheap imports, particularly of electric cars, and other clean technologies from China.
Before 2026, the bloc will start collecting taxes on steel, cement and various other imports.
The EU wants to simplify rules in order to reduce the administrative burden on industry. It could potentially scale back the carbon border tax to only 20% of companies that are covered by the scheme because they produce nearly all the emissions.
The draft stated that the Commission would propose a scheme to fund industrial CO2-cutting project using revenue from the EU Carbon Market, but did not specify how much money would be set aside.
(source: Reuters)