TotalEnergies CEO Patrick Pouyanné stated in an exclusive CNBC interview that the world is experiencing refining margins at levels 'never experienced' before, driven by the ongoing war with Iran and its impact on global energy markets [1]. Despite roughly 15% of TotalEnergies' production being offline due to the conflict, surging oil prices—particularly Brent crude trading above $100 a barrel—have compensated for lost barrels. However, Pouyanné emphasized that the crisis is having an even larger impact on product prices, with Asian jet fuel and other refined products seeing margins far higher than Brent crude itself [1].
The conflict has also jeopardized the spring planting season, as about 30% of global fertilizer moves through the Strait of Hormuz, which is now at risk [1]. In the LNG market, last week's Iranian drone attacks caused 'extensive damage' to QatarEnergy's Ras Laffan plant, effectively taking 20% of global LNG supply offline and sending natural gas prices in Europe and Asia surging [1]. European natural gas traded around $18 per million British thermal units (MMBtu) on Tuesday, but Pouyanné warned prices could spike to $40/MMBtu this summer if the war continues, especially as Asian demand rises and Europe seeks to refill storage [1].
TotalEnergies, a major exporter of U.S. LNG, is able to fulfill current orders in Europe and Asia due to its diversified global portfolio, but the CEO cautioned that prolonged conflict could further strain supply and drive prices higher [1]. In a separate development, TotalEnergies struck a deal with the Trump administration to abandon its offshore wind projects in exchange for $1 billion, which will be reinvested into U.S. oil and gas projects. Pouyanné explained that offshore wind no longer makes sense in the U.S. given cheaper alternatives and regulatory challenges [1].
CONCLUSION
The ongoing conflict with Iran has led to unprecedented refining margins and significant disruptions in LNG supply, causing energy prices to surge globally. TotalEnergies is managing current orders but warns of further price spikes if the war persists. The company's strategic pivot away from offshore wind toward oil and gas underscores shifting priorities amid volatile market conditions.