ExxonMobil could sustain, profit marginally at lower price environment

Oil&Gas Materials 2 November 2020 10:34 (UTC +04:00)
ExxonMobil could sustain, profit marginally at lower price environment

BAKU, Azerbaijan, Nov.2

By Leman Zeynalova – Trend:

In any case, the US ExxonMobil company could sustain and profit marginally at lower price environment, given its aggressive measure to reduce operating cost by approximately 20 percent from 2019, Trend reports with reference too GlobalData.

Exxon Mobil Corporation has recently announced an estimated third quarter 2020 loss of $680 million, or $0.15 per share assuming dilution. Third quarter capital and exploration expenditures were $4.1 billion, bringing year-to-date spending to $16.6 billion, more than $6 billion lower than the prior year period.

Third quarter results improved by $400 million from the second quarter, primarily driven by early stages of demand recovery; excluding identified items, results improved by $2.2 billion.

“ExxonMobil is very confident that it could potentially outperform its peers if the company is able to optimize its assets - preparing to capture a bigger market share once oil demand recovers closer to pre-pandemic levels by year 2022, as forecast by the IEA. The company is focused on the short-to-medium-term outlook with no indication of shifting away from oil.

“Indeed, the company is betting big on the future mismatch of supply and demand of oil, due to underinvestment and project delays across the whole value chain of the sector caused by COVID-19 economic crisis. In this context, ExxonMobil’s narrative is fully aligned on preparing to take on the role of providing for future hydrocarbons demand, in contrast to European counterparts that clearly state their goals in pivoting towards low carbon cleaner energy.

"Despite a lower guidance for capital spending in 2021 down to approximately $16-19bn, ExxonMobil remains focused to invest in high-value investment such as Guyana and Brazil, while pacing the development of Permian and Mozambique LNG. The company also believes that there is a significant upside in downstream and chemicals segment as the current profit margin is at the bottom of the cycle. Furthermore, ExxonMobil is leveraging on its operational scale by integrating downstream and chemical segment to further improve margin.

“Additionally, ExxonMobil is planning to further high grade its asset portfolio by expanding the current divestment program which could return up to approximately $35 billion. However, the company recognizes the competitive market in asset sale currently and modestly pursuing this opportunity,” said the company.


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