WEATHER AUTHORITY : Heat Advisory View Alerts
STREAMING NOW: Watch Now

Exxon is missing out on the oil boom

ExxonMobil is struggling to cash in on America's oil boom.The largest US oil company revealed on Friday that i...

Posted: Jul 27, 2018 1:45 PM
Updated: Jul 27, 2018 1:45 PM

ExxonMobil is struggling to cash in on America's oil boom.

The largest US oil company revealed on Friday that it pumped 7% less oil and gas around the world last quarter. It's a reflection of how Exxon was late to capitalize on the shale revolution in its own backyard.

Exxon's profit climbed by 18% to $3.95 billion. However, that widely missed expectations and is well shy of the spiking earnings that many of its smaller, more nimble peers are enjoying thanks to soaring oil prices and aggressive production.

Shares of Exxon dropped 4%, continuing their recent struggles.

"Exxon's production was very, very weak. It's been declining virtually nonstop. A 7% decline is really quite extreme," said Pavel Molchanov, an energy analyst at Raymond James.

Chevron, Exxon's biggest rival, revealed on Friday that its profits more than doubled to $3.4 billion thanks to higher oil prices and a 2% increase in production.

"You've got Exxon shrinking and Chevron growing. That's a massive gap," said Molchanov.

Related: Exxon isn't as might as it once was

Exxon's latest results may not be enough to restore investor confidence in a company that remains in a deep slump. Its production has declined in eight of the past nine quarters even as the United States pumps more oil than ever before.

"This quarter was a low point," Neil Chapman, Exxon's senior vice president, said during a conference call.

The steepest declines came in Europe, where Exxon's natural gas business has been stumbling. Production there plunged 30%.

Exxon said it's also intentionally cutting back natural gas production in the United States to "pivot" toward oil. That decision reflects depressed natural gas prices and underscores the damage done by Exxon's 2010 purchase of natural gas producer XTO Energy.

Another problem for Exxon: scheduled and unscheduled maintenance sidelined operations, including some incidents at its refineries.

"We are not happy about it. We're all over it," Chapman said.

Related: BP is going big on American shale

The good news for Exxon is that it's now investing heavily in shale -- and it's starting to see some results. Exxon said its production in the Permian Basin of West Texas and Bakken of North Dakota soared 30% last quarter. And it's rapidly adding oil rigs in the Permian, America's largest and fastest-growing oilfield.

CEO Darren Woods is also attempting to jump-start growth by plowing billions of dollars into expensive projects in South America, Africa and Papua New Guinea.

Progress in those overseas projects, as well as in the Permian, "are positioning us well" to meet long-term growth targets, Woods said in a statement.

But investors are losing patience with Exxon as its rivals focus on returning cash to shareholders through massive buybacks. Exxon scrapped its buyback plan in early 2016 as oil prices crashed.

Even though Chevron's soaring earnings missed expectations, the No. 2 US oil company revealed plans to launch a share buyback program. Chevron said it anticipates repurchasing $3 billion of stock per year.

Mississippi Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 33591

Reported Deaths: 1204
CountyConfirmedDeaths
Hinds269748
DeSoto181818
Madison138236
Jones117349
Harrison104014
Rankin103515
Neshoba102274
Lauderdale94281
Forrest93943
Scott79215
Jackson72717
Washington64310
Copiah63115
Leake61320
Lee58621
Holmes57341
Oktibbeha56828
Wayne55416
Warren55320
Yazoo5436
Grenada5357
Lowndes52613
Leflore52256
Lincoln50935
Lamar5027
Pike47020
Sunflower4528
Lafayette4374
Monroe43635
Covington4195
Panola3996
Bolivar38018
Attala37524
Simpson3733
Newton35710
Adams34019
Pontotoc3266
Tate32313
Marion31312
Claiborne29310
Chickasaw29219
Winston28711
Pearl River27632
Noxubee2758
Marshall2693
Jasper2676
Clay25511
Union23811
Smith23412
Walthall2267
Coahoma2156
Clarke21425
Lawrence1992
Yalobusha1938
Kemper18014
Carroll17311
Tallahatchie1664
Humphreys15910
Montgomery1493
Calhoun1475
Tippah14411
Itawamba1418
Hancock13813
Webster12811
Tunica1193
Jefferson1173
Jefferson Davis1164
Prentiss1123
Greene10810
Amite1063
George1023
Wilkinson959
Tishomingo921
Quitman891
Alcorn852
Perry764
Choctaw754
Stone732
Franklin492
Benton420
Sharkey420
Issaquena101
Unassigned00

Alabama Coronavirus Cases

Confirmed Cases: 48588

Reported Deaths: 1042
CountyConfirmedDeaths
Jefferson6030162
Mobile4418137
Montgomery4339109
Tuscaloosa254448
Madison19078
Marshall186611
Shelby150924
Lee149437
Morgan12205
Baldwin111410
Walker105127
Elmore98919
Dallas9639
Franklin92216
Etowah88214
DeKalb8416
Chambers65727
Russell6570
Autauga65313
Butler64328
Tallapoosa61669
Unassigned58626
Limestone5741
Houston5526
Cullman5395
Lauderdale5376
Lowndes48022
St. Clair4692
Colbert4656
Pike4595
Escambia4528
Calhoun4365
Coffee4074
Covington39911
Jackson3742
Bullock37010
Barbour3672
Dale3621
Talladega3497
Hale33722
Marengo33011
Wilcox2968
Clarke2946
Winston2893
Chilton2872
Sumter28512
Blount2731
Pickens2556
Monroe2492
Marion24514
Randolph2449
Conecuh2277
Perry2091
Bibb2081
Macon2069
Choctaw20212
Greene1928
Henry1433
Crenshaw1273
Washington1277
Lawrence1170
Cherokee1127
Geneva920
Lamar811
Fayette781
Clay742
Coosa621
Cleburne411
Out of AL00
Tupelo
Scattered Clouds
79° wxIcon
Hi: 95° Lo: 69°
Feels Like: 82°
Columbus
Clear
77° wxIcon
Hi: 95° Lo: 69°
Feels Like: 78°
Oxford
Clear
77° wxIcon
Hi: 93° Lo: 68°
Feels Like: 78°
Starkville
Clear
77° wxIcon
Hi: 92° Lo: 67°
Feels Like: 78°
WTVA Radar
WTVA Temperatures
WTVA Severe Weather