HOUSTON, April 8 ― Exxon Mobil Corp yesterday throttled back investment in shale, natural gas and deep water production, cutting planned capital spending by 30 per cent this year as the coronavirus pandemic saps energy demand and oil prices tumble. Oil companies have pulled back 2020 spending...
Exxon's cuts will weigh the heaviest on US shale, where it had plunked down US$6 billion in 2017 for drilling leases and boosted output in a drive to pump around 360,000 barrels per day this year. ― Reuters pic
In a one-two punch, crude prices have sunk nearly 60 per cent this year on lower demand for fuel spurred by the pandemic-driven economic hit and an oil price war. The largest US oil producer set 2020 capital expenditure at US$23 billion , down US$10 billion from its earlier plan and the lowest in four years. Spending could drop even further and continue into next year if required, Woods said.The company took no action on its shareholder dividend, which analysts had been closely watching for any reduction. Exxon spent US$14.8 billion last year on shareholder payouts.
Its output there this year will be around 15,000 bpd lower than planned and up to 150,000 bpd lower next year, Woods said. “Storage is becoming very tight. Logistics are becoming tight,” Woods said, forecasting widespread oil-well “shut-ins across the industry.”
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