Exxon doesn’t announce job cuts, and a spokesman declined to say whether the company has reduced its workforce in response to low oil prices.
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Chevron, the second-largest energy company in the USA by revenue, said it would lay off between 6,000 and 7,000 employees.
Oil executives are standing by promises to protect dividend payouts from the collapse in crude prices even as they fire workers, cancel drilling projects and sell everything from oil fields to aircraft to conserve cash. Capital spending next year is set 25% below 2015 at $25-28 billion.
Now according to Exxon Mobil’s estimates, it has not only been able to balance its cash flows, but the company has also said that so far, it has generated $7.4 billion free cash flow.
Its third-quarter profit came in at $2.04 billion, or $1.09 a share, down from $5.6 billion, or $2.95 a share, a year earlier. Revenue fell 37.4% to $67.34 billion.
Exxon reported 3Q earnings of $4.24 billion, or earnings per share (EPS) of $1.01, beating analysts’ EPS expectations of 12 cents.
In the refining and marketing, or downstream business, however, Exxon Mobil managed to almost double its earnings to $2.03 billion backed by a strong performance in the global markets where profits almost tripled to $1.55 billion. The average estimate of 10 analysts surveyed by Zacks Investment Research was for earnings of 89 cents per share.
Oil producers as diverse as Britain’s BP Plc, Norway’s Statoil ASA, and ConocoPhillips and Occidental Petroleum Corp. of the US are following the same track, maintaining or lifting dividends while curtailing other sorts of investments to cope with crude that has fallen to about $45 a barrel. The accounting included a large $8.2 billion write-off due to a downward revision of its oil and gas price outlook and also a decision to halt projects in Alaska and Canada.
Chevron Corp. said profit dropped for a fourth-straight quarter as the industry endures its worst oil- market slump since the 1980s.
Exxon Mobil is dealing with oil prices that have dropped by half since June 2014 and have remained lower for longer than most industry experts expected. Worldwide upstream profits rose from $578 million a year ago to $962 million and included a net benefit of $141 million on foreign currency effects. The statement was released before the opening of regular USA trading. The average price for natural gas was $1.96 per thousand cubic feet, down from $3.46. The Company has a market cap of $1.60 billion and EPS ratio of -1.98.
“It’s not only the falling price of oil and the oversupply of oil, but it’s also the falling demand for oil in China and in other parts of the U.S.”, Challenger said. In addition, operating and administrative costs were 7 percent lower than previous year, and further reductions were likely.
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Chevron said it would trim its capital spending by 25 percent next year, the Wall Street Journal reported.
