HOUSTON—Norwegian energy giant Statoil ASA’s strategy for navigating its way through the global commodity price downturn is simple: Stick to the upstream-centric strategy that made it an energy giant in the first place, a senior executive told Hart Energy at the recent IHS CERAWeek conference in Houston.

“The downturn doesn’t change our strategy very much,” said Tor Martin Anfinnsen, executive vice president for marketing, processing and renewable energy. “What we see, however, is the downstream [division] contributes more to the company results than it normally does, but since we are so heavily weighted to the upstream and much slimmer on the midstream and downstream, we’re not able to balance this out.”

That has resulted in some disenchantment among investors. Statoil’s stock price has declined about 32% since the start of fourth-quarter 2014, prompting a pessimistic outlook from some analysts.

“Changes in crude prices affect Statoil’s shares more than its peers given its greater upstream leverage,” noted J.P. Morgan, which forecasts the company’s share price to continue to drop another 23%.

Oslo-based Arctic Securities expects the company’s balance to continue to deteriorate through 2015 and has lowered its expected earnings per share for 2016 by 55%.

But Statoil remains a powerhouse, with a market capitalization of about US$63 billion, and if opportunities arise for acquisitions during this sluggish period it plans to at least take a look.

“We are a big company and we are, financially, in a very robust place, so that means we have the opportunity to do it,” Anfinnsen said. “Whether we will end up doing it, that remains to be seen. But our focus will typically be to look at upstream assets and to look at upstream assets that can underpin the positions we have. [Our strategy is to] deepen positions we have rather than to venture into completely new areas.”

Could a midstream acquisition fit into this plan?

“Not per se,” he said. “Not on a stand-alone basis, but it could be a consequence of what we choose to do with upstream. Upstream will be the main driver for any consolidation activity.”

Given the current oversupply of petroleum on world markets, Statoil is keeping an eye on the storage situation, though it is unconcerned in the short term.

“I think we will see that the storage situation will affect the short-term prices, but most of production would of course be consumed or go into refineries,” Anfinnsen said. “There would be a small marginal volume that doesn’t find a home and that needs to go into storage, and that small marginal volume will also be a price-setting volume. So we expect to be able to sell our production, but the market price will be affected by the general overhang in the industry and potential shortage in the future of storage.”

Anfinnsen also noted an unexpected geopolitical positive that emerged from its deal to sell LNG to Lithuania.

“What we understand is that with this alternative supply from us, the Russians were incentivized to ‘adjust their pricing,’” he said. “For Lithuania, it has had a very positive effect beyond the physical volumes that have been provided by an alternative supplier. We are pleased to help.

“We’d also like to see LNG and natural gas used much more widely as a marine fuel going forward,” he said. “Small-scale LNG could contribute to that.”

Joseph Markman can be reached at jmarkman@hartenergy.com.