Tumbling oil prices slam profit at Exxon Mobil, Chevron
By Ernest Scheyder and Anna Driver
(Reuters) - Weak oil prices shriveled quarterly profit at Exxon Mobil Corp and Chevron Corp on Friday, compelling both companies to rethink operations and plan for what many expect to be a sustained period of cheap crude.
Earnings at U.S. oil majors Exxon, which were the worst in a decade, and Chevron missed analysts' expectations, adding to concerns that perhaps executives had not acted quickly enough to mitigate the impact of an over-50-percent drop in oil prices since last summer.
The results highlight how smaller and more nimble U.S. shale oil companies have slashed costs faster and more aggressively than global majors. Some shale producers have cut back drilling by 60 percent or more.
Evan Calio, an analyst with Morgan Stanley, said on Exxon's earnings conference call that the oil giant appeared to be less vocal than its peers about cutting costs.
Jeff Woodbury, Exxon's head of investor relations, responded that the company was constantly focused on capital efficiency and cost management.
Still, Exxon is sticking for now with its plans to spend $34 billion this year, although that figure has a downward bias because of cost savings and efficiencies, Woodbury said.
Chevron also still plans to spend $35 billion this year, but said it would spend less in 2016 and 2017 as several mega projects come online.