The latest Market Talks covering Energy markets. Published exclusively on Dow Jones Newswires throughout the day.

0840 ET - Germany's new government will likely follow through with its plans to reduce electricity prices through tax cuts, BMI Research analysts say in a webinar. Analysts at the British research firm expect residential and industrial electricity prices to fall by over 12% in 2025 and electricity consumption to grow 3.5% annually in Germany. These trends will be driven by the electrification of the economy, with electric vehicles and data centers playing a central role. However, the analysts question the Christian Democratic Union's plans to revive decommissioned power plants due to high costs, regulatory hurdles and technological challenges. (helena.smolak@wsj.com)

0755 ET - Chinese oil-demand growth is expected to improve this year, according to Shin Kim, head of Altview, crude and refined products at S&P Global Commodity Insights. "There's still a lot of structural issues," she says at the London Energy Forum. But "the worst is over." Beijing's stimulus measures to revive economic growth and investment in infrastructure should help support demand for diesel and gasoil, Kim says. Last year, demand in the world's top importer of crude oil slowed significantly, weighing on the global oil outlook and fueling concerns over an oversupplied market. (giulia.petroni@wsj.com)

0752 ET - Repsol's 700 million euros share buyback for 2025 is solid, HSBC analysts write in a note to clients. The amount was in line with the analysts' expectations and there is scope for more given the Spanish energy company said it was the minimum amount they expect to return, they say. Repsol committed to returning 25% to 35% of cash flow from operations to shareholders, and its 2025 buyback implies a 30% return, they say. The analysts don't expect Repsol to sustain payouts at the upper-end of its range beyond 2026 as debt rises. Shares trade down 2% at 12.45 euros. (adam.whittaker@wsj.com)

0719 ET - A survey conducted at S&P Global Commodity Insights' energy forum in London found that around 42% of participants expect Brent crude to be priced between $65 and $75 a barrel by year-end. Another 42% forecast it in the $75-$85 a barrel range. Of the roughly 210 respondents, only 2% predicted prices above $95 a barrel. Brent closed last year at $74.645 a barrel, according to S&P Global. In afternoon trade on Monday, the international oil benchmark trades at around $74 a barrel. "It's a relatively stable price environment and it's quite surprising," says Richard Swann, head of established benchmarks at S&P Global Commodity Insights. (giulia.petroni@wsj.com)

0704 ET - OPEC+ isn't expected to increase oil production this year due to current market dynamics, says Shin Kim, head of Altview at S&P Global Commodity Insights. The cartel and its allies will soon decide whether to maintain their plans to gradually raise output starting from April, despite U.S. President Trump's calls to lower prices. "Yes there's a lot of politics, yes there's a lot of pressure," Kim says, also citing OPEC+ members' fiscal requirements. "But there's no more room for barrels," especially in light of rising non-OPEC+ production outside of the U.S. OPEC has historically prioritized a stable market and maintaining stability now means refraining from adding more barrels, she says. Altview is an independent team within S&P Global providing forecasts for crude oil and refined products. (giulia.petroni@wsj.com)

0659 ET - European natural-gas prices continue to slide below 50 euros a megawatt hour on warmer European Union weather forecasts and optimism for a Russia-Ukraine peace deal. The benchmark Dutch TTF contract trades 3.9% lower at 45.35 euros a megawatt hour. Gas prices hit two-year highs in mid-February on stronger demand and fast-depleting inventories, before sharply selling off as the U.S. and Russia agreed to start talks to end the war in Ukraine. The global natural gas and LNG market still remains tight despite warmer weather forecasts, JPMorgan analysts say in a note. Official communication on European gas regulations is expected next week, though preliminary discussions indicate storage regulations may become more flexible, JPM adds. EU members are currently required to fill storage facilities to at least 90% of their capacity by Nov. 1. (joseph.hoppe@wsj.com)

0500 ET - Siemens Energy trades lower after German elections, with downbeat investor sentiment toward energy companies that focus on renewables and sustainable energy. "There are signs that wind farms will no longer be designated quite so easily under a different government," says a trader. Siemens Energy owns wind energy company Siemens Gamesa. Shares trade 5.8% lower. (michael.denzin@wsj.com)

0428 ET - Oil prices slide, with Brent crude and WTI both down 0.1% at $74.01 a barrel and $70.35 a barrel, respectively. Oil is under increasing downward pressure as sentiment sours, ING analysts say in a note. Friday saw a sharp selloff as investors cut positions in Brent, with trade and tariff concerns, alongside a push for a peace deal between Russia and Ukraine weighing on the market, ING analysts say. There is also intensifying speculation about OPEC+ production. The group is currently cutting supply by 2.2 million barrels a day and is scheduled to hike output from April, though there are suggestions OPEC+ is considering a delay, ING says. Any such delay would lead to a change in oil balance, leaving the market relatively tighter than expected, ING adds. (joseph.hoppe@wsj.com)

0424 ET - The proposed merger of Saipem and Subsea7 creates a global offshore powerhouse which should appeal to shareholders, Barclays analysts Mick Pickup and Pratik Kadam write. The deal comes with commitments of shareholder returns and combines two complimentary wind businesses. More importantly it creates a 43 billion euro, over 2 billion euro EBITDA company with expected synergies of 300 million euros, and a scale that investors have been lacking, in the bank's opinion. The rationale is clear - a larger more diversified fleet would be able to operate more efficiently, enabling global optimization for its clients, Barclays says. The commitment of both companies to distribute up to $350 million in 2025 will likely be seen as a positive, it says. Saipem share rise 0.4% while Subsea7 shares gain 6.7%. (dominic.chopping@wsj.com)

0403 ET - The proposed merger of Saipem and Subsea7 would create a market leader in the offshore space, expanding on an existing collaboration where the companies already jointly identify, bid and execute new projects in fixed offshore wind, Berenberg analysts write. The rationale for consolidation includes the ability to offer clients a more comprehensive solution through a diversified fleet and complementary offerings, and potential annual synergies of around 300 million euros. "We would expect a positive reaction from investors to this news." A combination would bring together Saipem's fleet of 33 vessels/drilling rigs with Subsea7's fleet of 41 vessels operating globally across subsea and renewables. It would bring the combined number of onshore facilities to 16. Saipem share rise 0.9% while Subsea7 shares gain 6.2%. (dominic.chopping@wsj.com)

0306 ET - The possible merger of Saipem and Subsea7 will create cost savings and a strengthened integrated offering, particularly in offshore, Citi analyst Kate O'Sullivan writes. The combined business will be renamed Saipem7 when the deal closes in the second half of 2026. "We think the benefits of oil services consolidation such as this include cost rationalization, tightening utilizations and improved access to integrated offerings." Additionally Citi sees a potential significant boost to shareholder distributions in 2025/2026 for Saipem and Subsea7 shareholders based on the transaction memo of understanding. Citi has buy/high risk ratings on both Saipem and Subsea7. Subsea7 shares closed at 181.60 Norwegian kroner and Saipem at 2.32 euros. (dominic.chopping@wsj.com)

0259 ET - Shares in Subsea7 and Saipem should both react positively this morning after the companies announced a proposed merger, RBC Capital Markets analyst Victoria McCulloch writes. The enlarged business would have a 43 billion euro backlog, revenue of around 20 billion euros, and EBITDA of over 2 billion euros, McCulloch says. "The deal terms put a premium on Subsea7's market cap relative to Saipem based on Subsea 7 distributing 450 million euros in cash to shareholders prior to the deal's completion." Based on the 450 million euro cash distribution and the implied 50/50 split of the combined businesses, RBC thinks there's a premium being attributed to Subsea7's business. This already trades at a higher valuation multiple. Subsea7 shares closed at 181.60 Norwegian kroner and Saipem at 2.32 euros. (dominic.chopping@wsj.com)

(END) Dow Jones Newswires

February 24, 2025 08:40 ET (13:40 GMT)

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