Australia's Woodside Energy Group Ltd (WDS.AX) reported a fall in second-quarter revenue on Wednesday, missing estimates, due to weaker liquefied natural gas prices and maintenance work at some of its facilities in Western Australia.
Oil and gas prices have retreated from the levels hit in 2022 in the wake of Russia's invasion of Ukraine, with a slower-than-expected economic recovery in key consumer China weighing on fuel demand.
Despite concerns surrounding energy demand, oil producers are set to log profits as a limited supply growth is expected to support prices until the Organization of the Petroleum Exporting Countries (OPEC) and major producers including Russia, together known as OPEC+, raise production in 2024.
E&P Financials analyst Adam Martin said probable upside risks appeared to be building up for higher energy prices provided potential dangers of a looming global recession were avoided.
"I suppose Woodside has the potential to improve its performance in the upcoming quarters, or at least maintain it around similar levels, considering the forecast supply crunch amid global output cuts and OPEC+ situation," Martin said.
Shares of Woodside advanced 1.3% to A$36.01 by 0021 GMT, outperforming a 0.6% rise in the broader market (.AXJO).
Woodside, which maintained its full-year production and capital expenditure guidance, faced operational hurdles due to planned maintenance work at the onshore Pluto LNG facility and associated offshore facilities during the June quarter.
Australia's top independent oil and gas explorer said revenue came in at $3.08 billion for the three months ended June 30, compared with $3.44 billion a year earlier and missing a UBS estimate of $3.33 billion.
The quarterly average realised price for LNG fell to $63 per barrel of oil equivalent (boe) from $95 per boe a year earlier.
Woodside produced 44.5 million barrels of oil equivalent (mmboe) in the June quarter, compared with 33.8 mmboe in the year-earlier period and missing a UBS estimate of 46.6 mmboe.
