UK-headquartered Shell has increased its brand value by 18% to $49.9bn, having withstood global disruptions such as the Covid-19 pandemic; the conflict in Ukraine; and the increased awareness about ESG causing widespread havoc to the oil and gas sector, according to brand valuation consultancy Brand Finance.
The consultancy reported that after a tough two years due to wildly fluctuating demand, the global oil and gas sector is powering ahead with the world’s 50 most valuable oil and gas brands achieving an aggregate growth of 8% this year.
Brand Finance noted that Shell’s brand is increasingly focused on developing an energy transition strategy as it aims to become a net-zero emissions energy business by 2050, in step with society’s progress towards the goal of the Paris Agreement on climate change. While the energy transition brings risks to Shell, it also creates new opportunities for the brand to develop. Increasingly, it appears likely to sustainably lead the global oil and gas industry transition to a net-zero energy system.
Shell’s CEO on attaining net-zero
Dean Aragon, CEO & vice chairman of Shell Brands International AG in an interview with Brand Finance noted that Shell’s CEO Ben van Beurden said they must “go faster, be bolder” in becoming a net-zero emissions energy business by 2050, towards the goal of the UN Paris Agreement on climate change.
Aragon added: “Becoming a net-zero emissions energy business means that we are reducing emissions from our operations, and from the fuels and other energy products we sell to our customers. It also means capturing and storing any remaining emissions using technology or balancing them with offsets.
“We are transforming our business to meet our target, providing more low-carbon energy such as charging for electric vehicles, hydrogen and electricity generated by solar and wind power. We are also working with our customers as they make changes too, including in sectors that are difficult to decarbonise such as aviation, shipping, road freight and industry. Our powering progress strategy will help us deliver on these ambitions and play our part in one of the greatest challenges facing our generation.”
Summary of the Brand Finance‘s 2022 findings:
- Shell is the world’s most valuable brand in oil & gas, valued at US$49.9 billion
- Aramco retains second place globally with 16% brand value growth
- ADNOC grows strongly, benefits from top brand guardian CEO in the industry
- China’s PetroChina and Sinopec struggle, behind continuing COVID curtain
- Petronas is the world’s strongest oil & gas brand with AAA rating
- Devon triples in brand value to be the world’s fastest-growing oil & gas brand as merger completes
Oil & gas brands in the Middle East
State-owned oil & gas groups continue their transformation by positioning themselves as enablers of the energy transition.
Aramco remains the most valuable brand of all brands in the Middle East, and naturally dominates the sector. Saudi Arabia’s national oil company increased its brand value by 16%, consistent with the restoration of oil prices after the COVID-19 pandemic-affected years of 2020 and 2021.
ADNOC, the Middle East’s second-most valuable brand, grew its brand value by 19% based on the same underlying fundamental factors. While ADNOC doesn’t have the same scale as Aramco it is instead focussing on being the strongest brand in its category. The ADNOC brand continues to be the strongest oil & gas brand in the region.
Commenting on the findings, David Haigh, chairman and CEO of Brand Finance, said: “The energy transformation is both the greatest challenge and the greatest opportunity facing the oil and gas sector.”
“The industry can be both optimistic and realistic about the risks and opportunities that lie ahead, but it will be tough for brands to simultaneously navigate the recovery from Covid, the conflict in Ukraine, and broader concerns about environmental sustainability in the future. Shell, Aramco, and others, will be challenged to transform in coming years to leverage their brands to deliver for their customers.”
Global outlook
In China, the largest two oil and gas brands remained PetroChina (brand value down 6% to US$29.7 billion) and Sinopec (brand value down 5% to $25.2bn) which were ranked as the third and fourth most valuable brands globally. Each of the challenges faced by Western oil and gas brands have been exacerbated in China and the continuing Covid-19 curtain of restrictions have subdued demand for oil and gas products, Brand Finance reported.
Petronas (brand value up 13% to $13.6bn) is the strongest brand in the ranking with a Brand Strength Index (BSI) score of 87.7 out of 100 and a corresponding brand rating of AAA. The consultancy noted that Petronas is well placed to further strengthen its brand as it aims to sustainably provide a diversified range of energy options and fuels as it targets net-zero carbon emissions by 2050.
