Orsted Shares Surge as U.S. Reverses Halt Order on Equinor’s Wind Project

Shares of offshore wind developer Orsted experienced a significant 15% increase on Tuesday following the U.S. administration’s decision to revoke an order that had halted work on a project by competitor Equinor. This move has alleviated concerns surrounding Orsted’s U.S. projects currently in development.

Late on Monday, Equinor announced that the Trump administration had lifted a month-old stop-work order on its Empire Wind offshore wind project in New York. This development provided relief for the Norwegian company and the U.S. offshore wind industry as a whole.

As a result of this news, Equinor’s share price rose by 1.5% by 0948 GMT, while Orsted’s shares saw an impressive increase of 15.1%. It is worth noting that Equinor holds a 10% stake in Orsted.

Positive Outlook for Orsted

Analysts at Jefferies expressed optimism about the implications of the reversal of the stop-work order on Orsted. They highlighted that the concerns raised by the Empire Wind stop-work order had significantly impacted market sentiment regarding Orsted’s ongoing projects in the U.S., leading to a substantial decline in the company’s market value following the U.S. election.

Orsted is currently actively involved in the construction of the Revolution Wind and Sunrise Wind projects off the coasts of Rhode Island and New York, respectively.

Market Response and Future Prospects

Analysts at JPMorgan also weighed in on the situation, emphasizing the positive impact of the U.S. government’s decision on Orsted’s stock performance. They noted that while unforeseen developments in the U.S. offshore wind sector cannot be completely ruled out, the recent decision should help alleviate risk perceptions surrounding Orsted’s projects.

Despite this positive development, Orsted still faces challenges such as the impact of tariffs on its U.S. ventures and cost-related concerns in other regions. For instance, the company recently halted the development of its British Hornsea 4 project due to cost considerations, according to JPMorgan.

Overall, the reversal of the stop-work order on Equinor’s project has provided a much-needed boost for Orsted and the broader U.S. offshore wind industry. While uncertainties remain, the outlook for Orsted appears more favorable following this recent turn of events.

(Reuters/Reporting by Nora Buli; Editing by Jan Harvey)