Exxon Plans Spending Cuts in Response to Oil Crash

By Christopher M. Matthews

Exxon Mobil Corp. said Monday that it is looking to significantly reduce spending as a result of market conditions caused by the coronavirus pandemic and oil price rout.

"Based on this unprecedented environment, we are evaluating all appropriate steps to significantly reduce capital and operating expenses in the near term," Chief Executive Darren Woods said in a statement Monday.

The company said it would outline specific cost-cutting plans in the future.

Rival Chevron Corp. has previously said it was also looking for ways to cut spending. Dozens of smaller U.S. oil and gas companies are dramatically reducing budgets and curtailing oil and gas production as they enter survival mode in response to the price plunge.

Global oil prices have fallen below $30 a barrel in recent days to their lowest levels in years. Meanwhile, shares of S&P 500 energy companies have hit their lowest level in more than 15 years, while Exxon and Chevron have lost about $200 billion in combined market value already this year.

On average, drillers are planning to spend about 40% less than they did last year, according to a J.P. Morgan Chase & Co. analysis of roughly a dozen public producers that disclosed new budget plans last week.

Write to Christopher Matthew at [e-mail]

(END) Dow Jones Newswires

March 16, 2020 20:20 ET (00:20 GMT)

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