Oil market to stabilize in 2026 at $60 floor - Vår Energi CEO
Vår Energi CEO Nick Walker told reporters on Tuesday that oil supply and demand should align in 2026. He said prices will likely hold above $60 per barrel due to years of low industry investment.
The Norwegian oil and gas producer, the country's third largest, reported fourth-quarter production climbing toward ~430,000 barrels of oil equivalent per day. The company maintained its dividend guidance at $1.2 billion annually for both 2025 and 2026.
Walker pointed to under-investment in oil production as the main factor supporting prices. He said the market faces only a brief period of oversupply before rebalancing next year. When prices weaken, companies cut spending and production growth slows, he explained. Walker noted that crude has repeatedly found support near $60 per barrel, describing it as a practical price floor.
The production increase comes from two main sources: the Johan Castberg field in the Barents Sea and the Jotun FPSO in the Balder area. Both facilities have reached peak output. Vår Energi said seven of nine growth projects planned for 2025 are now producing.
The company plans to approve ten projects in 2025, with four already sanctioned. All ten projects have average break-even costs below $35 per barrel of oil equivalent. Vår Energi will pay quarterly dividends of $300 million.
Third-quarter results showed cash flow from operations at $1.2 billion. The company reported lower net debt and liquidity of roughly $3.6 billion.
Vår Energi operates on the Norwegian continental shelf and aims to maintain production between 350,000 and 400,000 barrels of oil equivalent per day through 2030. Recent asset additions include a larger stake in the Ekofisk Previously Produced Fields project.
Equinor operates Johan Castberg with Vår Energi as a partner. Equinor has set plateau capacity at about 220,000 barrels per day for that field. The company released these figures alongside its third-quarter update on Tuesday.
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