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Exxon boasts of balance during downturn

Exxon says upstream operations offsetting some of its industry declines, though overall third quarter results show energy sector still suffering through market downturn. Photo by Oskari Porkka/Shutterstock IRVING, Texas, Oct. 30 (UPI) — U.S. supermajor Exxon Mobil said declines in its exploration and production operations were offset by gains downstream, where lower prices actually helped. "Quarterly results reflect the continued strength of our downstream and chemical businesses and underscore the benefits of our integrated business model," Chairman and Chief Executive Officer Rex Tillerson said in a statement. Exxon said its upstream, or exploration and production sector, suffered "significantly" during the market downturn as crude oil prices continue to starve companies of revenue. Exxon reported third quarter earnings of $4.2 billion, down nearly 50 percent from last year. Crude oil prices are lower in part because markets are oversupplied at a time when global economic growth is weak. Exxon said […]

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Exxon’s `Leaner Ship’ Floats Higher than Rivals in Downturn

Decades of financial discipline that honed Exxon Mobil Corp. into the leanest, most-efficient oil company in the world are paying off in the worst market slump since the 1980s. As industry job cuts top 200,000 worldwide, Exxon has kept its 75,300-strong workforce intact with none of the sweeping layoffs seen at other oil companies, including its biggest U.S. rival Chevron Corp. “Exxon is just stronger financially than anyone else out there,” Brian Youngberg, an analyst at Edward Jones & Co. in St. Louis, said in an interview. “They were running a leaner ship to begin with.” Exxon posted higher-than-expected third-quarter earnings Friday thanks to soaring profit at its refineries that process oil into fuel. The business has blunted the impact of crude’s collapse. Exxon hasn’t needed to record any of the restructuring charges associated with job eliminations amid the 16-month downturn, and doesn’t expect to do so any time […]

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Chevron Cuts Jobs, Spending, Growth Target as Slump Persists

Chevron Corp. said it’s cutting about 10 percent of its workforce and scaled back its long-term production target amid the worst oil-market slump since the 1980s even as the company posted third-quarter profit that surpassed analysts’ expectations. Chevron said in a statement Friday that it will eliminate 6,000 to 7,000 jobs, the deepest cuts since the 2001 Texaco Inc. merger that created the company in its modern incarnation. Those numbers include a workforce reduction of 1,500 announced earlier this year. Oil and gas output will rise by 13 percent to 15 percent through the end of 2017, rather than the previously forecasted 20 percent production growth, the company said in a slide presentation. The company earned $1.09 a share, 33 cents more than the average of 21 analysts’ estimates compiled by Bloomberg. Profit from refining oil into fuels jumped 59 percent to $2.2 billion. Spending in 2016 will be […]

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That Time a Dog Claimed $46,000 in Damages From the BP Oil Spill

BP has been complaining for a long time that many claims filed after its April 2010 oil spill in the Gulf of Mexico were phony. Now there’s more evidence to back that up. BP has admitted fault in connection with the huge spill and is in the process of paying out tens of billions of dollars in government and individual claims, some civil and some criminal. At the same time, however, the British oil giant says that many of the demands made against its various claim funds have had scant, if any, connection to the catastrophe that killed 11 rig workers and spewed oil off the shore of Louisiana and other gulf states. In the single most egregious case of alleged fraud, BP sued Mikal Watts in December 2013, alleging that the powerful San Antonio plaintiffs’ attorney falsely claimed to represent tens of thousands of "phantom" victims of the […]

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Husky CEO Sees Canada-Only Carbon Tax as `Politically Suicidal’

Husky Energy Inc. Chief Executive Officer Asim Ghosh has a stern warning for Canadian political leaders considering changes to climate policy: don’t go it alone with a carbon tax. The Canadian oil producer controlled by Hong Kong billionaire Li Ka-Shing would support a tax if it’s applied broadly and at least includes the rest of North America, Ghosh said Friday on a conference call to discuss third-quarter earnings results. “It would be politically suicidal for us to do a mea culpa and hang our neck out in a way that disadvantages the industry here,” Ghosh said. “It has to be across the board and Canada as a jurisdiction or Alberta as a jurisdiction cannot be disadvantaged.” Alberta Premier Rachel Notley is planning changes to the government’s climate policy after already raising an existing carbon levy on the oil-producing province’s biggest emitters. Her New Democratic Party took power in May. […]

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U.S. oil demand growth slows to 2.1 percent in August as driving slows down

A drop of diesel is seen at the tip of a nozzle after a fuel station customer fills her car’s tank in Sint Pieters Leeuw December 5, 2014. The resurgence in U.S. oil demand is showing signs of flagging, with drivers easing off the gas pedal a bit in August, according to U.S. data on Friday that may weaken one of the key arguments for bullish oil traders. After several months of near 4 percent growth in fuel use that has helped offset weakness in demand from China, U.S. consumption climbed by just 2.1 percent or 414,000 barrels per day (bpd) in August versus the same month a year ago, U.S. Energy Information Administration data showed. Separate data from the Department of Transportation helps explain why: The number of miles Americans drove in August rose at the slowest pace this year, up 2.3 percent from a year ago. While […]

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Big U.S. shale oil savings fast becoming a thing of the past

Huge cost savings are waning for U.S. shale oil companies, marking an end to the drastic price cuts on equipment and services over the past 16 months that helped them survive the worst industry downturn in six years. Companies including Anadarko Petroleum Corp, ConocoPhillips and Occidental Petroleum Corp have saved millions on drilling and fracking wells in Texas, Colorado and North Dakota since the oil price slide started by demanding that oilfield service companies slash prices by 20 percent to 30 percent or more. Those savings, coupled with big gains in rig productivity that allowed more oil to be pumped with less equipment, created a lifeline for companies coping with a more than 50 percent drop in crude prices. But productivity gains have stalled in the last few months and deflation may be slowing as well, just as producers try to withstand a lower-for-longer price outlook. ConocoPhillips has seen […]

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Exxon third-quarter profit falls 47 percent but beats expectations

A Exxon Mobil gas station is seen in Encinitas, California October 28, 2014. Exxon Mobil Corp ( XOM.N ) said on Friday its third-quarter profit fell 47 percent hit by low crude prices, but results were better than expected, helped by higher profits in the oil company’s refining business. Crude prices have fallen more than 50 percent from last year’s high over $100 a barrel. While the crude decline hurt Exxon’s largest oil and gas business, it also boosted profit margins in refining by lowering feedstock costs. “Quarterly results reflect the continued strength of our downstream and chemical businesses and underscore the benefits of our integrated business model,” Exxon Chief Executive Officer Rex Tillerson said in a statement. The Irving, Texas, company posted profit of $4.24 billion, or $1.01 per share, compared with $8.07 billion, or $1.89 per share in the same quarter a year earlier. Analysts on average […]

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Canadian Oil Sands calls Suncor bid undervalued, exploitive

Canadian Oil Sands says its weathering weak market, recommending shareholders reject unsolicited bid from rival Suncor. Photo courtesy of Canadian Oil Sands CALGARY, Alberta, Oct. 30 (UPI) — While posting a heavy loss for the quarter, Canadian Oil Sands Ltd. said it was advising against what it considers an undervalued bid by rival Suncor. Canadian Oil Sands, among the largest owners in the Syncrude joint venture production group in northern Alberta, said its operating expenses fell to around $5 per barrel, its net debt declined and capital expenses were down 62 percent to $63.5 million. The company said it’s achieved around $750 million in cost reductions during the first nine months of the year. "Canadian Oil Sands is demonstrating its ability to weather this period of low oil prices and even a modest improvement in oil prices will generate robust expansion of cash flow," President and Chief Executive Officer […]

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European Energy Execs See Bleak Market Outlook Persisting

The outlook for oil and natural gas markets remains bleak for the rest of the year and much of 2016, executives from two European energy majors say. SINGAPORE, Oct 30 (Reuters) – The outlook for oil and natural gas markets remains bleak for the rest of the year and much of 2016, meaning there will be no let up in pressure to control costs, executives from two European energy majors said. Oil and liquefied natural gas (LNG) prices have more than halved from peaks in 2014, eroding producer revenues and forcing cost cuts and layoffs. "The industry is under so much pressure that you need to have a clear plan. You need to balance capital expenditure against production," BG Group Chief Executive Helge Lund told Reuters on the sidelines of a conference in Singapore. "Our capex in 2015 will be around 30 percent lower than in 2014. Given the […]

Posted On : Published By : Tom Whipple