Exxon Mobil Corp. more than doubled the budget cuts announced by any other shale company on Tuesday amid an historic crude-market crash. In all, nearly three dozen shale explorers have slashed more than $27 billion from their budgets in less than a month. Exxon, alone, said it will cut $10 billion in spending, a 30% reduction.
Oil prices are trading in the $20-a-barrel range as the result of a toxic combination of a killer pandemic and a price war between Saudi Arabia and Russia that’s flooding the world in oil. The spending cutbacks are expected to have a dramatic effect on the U.S. rig count, which is falling by record margins, according to industry consultant Rystad Energy. On Friday, the U.S. rig count fell by 64 to 664.
“The speed of this decline exceeds the initial post-oil-price-crash expectations,” Artem Abramov, head of Rystad’s shale research, said Tuesday in a report. “This downturn is the real test of US Land industry endurance.”
Here’s a summary of how energy companies are responding: