Exxon posts second straight quarterly loss on demand, price plunge

It was Exxon’s first back-to-back quarterly loss in at least 36 years, but was small in comparison to rivals who took giant charges last quarter. The top U.S. oil producer took no asset write-downs during the quarter, and got a 44-cent-a-share boost to earnings by increasing the value of inventories.

Exxon slashed capital spending 30% this year to around $23 billion, and Senior Vice President Neil Chapman said it expects to spend less than $19 billion in next year. That would be the lowest spending for the company since at least 2005.

Prior to the pandemic, Chief Executive Darren Woods pursued an ambitious spending plan to boost oil output and turn around sagging profits on a bet that a growing global middle class would demand more of its products.

The plan to significantly raise production and boost cash by selling assets has faltered, leading Exxon to slash costs to preserve an 8% shareholder dividend.

Exxon has identified an “undertaking a comprehensive evaluation,” of its global businesses, it said, without providing details.

Exxon’s oil and gas production business fell to a loss and its refining unit was hit by lower demand and weaker prices.

The US oil major reported a loss of $1.08 billion, or 26 cents per share, compared with a profit of $3.13 billion, or 73 cents per share, a year earlier. Excluding inventory adjustments, the loss would have been $3 billion, it said.

Exxon’s oil and gas output fell 7% to 3.6 million barrels per day during the quarter as it curtailed production due to the oil price crash.