Shell mulls move to U.S. to boost company valuation

Shell's new chief executive, Wael Sawan, was part of an executive team two years ago that considered moving Shell's headquarters to the United States and listing it there, according to FT sources.

The idea of relocation was eventually dropped, but the Financial Times noted that Shell's chief executive remained concerned about the valuation discrepancy between Shell and its US peers.

In fact, there is a stark difference in the valuations of European and US major oil companies. Analysts believe that there are two main reasons for this: the first is that ESG investment has a greater influence in Europe, and the other is that ESG investors and traditional investors seem to be less convinced of the transformation plan of European oil giants.

Meanwhile, at least one of Europe's big oil majors has said it will not stand steadfast in its turnaround plans. In releasing its latest financial results, the company said it had revised its plans to reduce emissions and now reduced oil and gas production as a means of reducing emissions.

"We're grossly undervalued," bp's Bernard Looney said as the company announced plans to boost oil and gas production in the medium term.

Barron's reported earlier this month that bp, Shell and Total Energy were trading at about five to seven times this year's expected profits, after they forecast record profits in 2022 .

Meanwhile, Barron's notes that ExxonMobil and Chevron are trading at 11 times their projected 2023 earnings. The British "Financial Times" reported that Shell's Sawan and other company executives were "shocked" by bp's announced production plan, and the company's shares rose 10% after the announcement of the production plan.