You have to compare to their spending to understand the context. What was the return?
That said, Exxon (and others) made it through. It’s fine. Just think whining now about them making a lot of money after losing $20G 2 years ago is weak. But everyone can carry on.
XOM lost $20 billion in 2020. They borrowed heavily at low rates to support the dividend
The biggest issue is that since Wall Street and the ESG mavens won’t invest in O&G, more capex must be internal while activist investors push for buy backs, dividends & green energy investments.
Exactly but no this is not true. I can already read it.
Exactly
People think that low gas prices are normal when really, $3-4 gas is probably what we are going to see going forward. That is unless EV’s destroy the gasoline market
The fracking boom made gas super cheap because there was too much supply. OPEC flooded the market keeping oil prices low.
Stock price tripled since the low in March 2020. Just made $18 billion in 3 months. I would say they are still a great company to invest in long term.
They make long term investments, so they lose big sometimes and make it up at others. There are external facters also, like when Saudi dumped cheap oil on the market to try to kill the shale oil business
He was President for 8 years.
Also, with high gas prices we see 2 things happen
Fracking may have occured but those other two took off during Obama’s tenure
Obama tried to shut down O&G but fracking on private property made it go. Barnett, Eagle Ford etc.
My beef was when the Saudis/OPEC tried to crush the US producers, the US should have placed a tariff on foreign oil pegged to $60.
In hindsight, such a tariff would have hurt innovations to make fracking more efficient
From the article: The irony is that President Obama – who is not viewed as a friend of the oil and gas industry – has presided over rising oil production in each of the seven years he has been in office. (
I’ve seen the employee layoffs with each bust at a big oil co. It’s painful.
OTOH, these companies do accumulate some dead wood over time,
so it gives reason to clean house. We had generous severance packages
with pensions; so in yet another sense they may the best companies to get
laid off from.
So they lost 15 billion
Could not think of a dumber thing to do than borrow money to pay a dividend. When you were getting nothing in return for borrowing that money to pay a dividend.
The dividend is a huge deal to Exxon. They will do whatever it takes to not cut it as we saw.
Yes. It may be a huge deal to them. Doesn’t make it any less dumb.
And the kind of thing you’ll see happen when you have engineers running the finance piece of the business.
Just wait until these independent producers have to actually start drilling and completing wells again. They’re slowly drilling a few wells here and there, but it ain’t fast enough to catch up with demand. Once all the DUC wells are gone, they will have to start injecting capital into drilling programs again.
Labor shortages, supply chain bottlenecks, drill/frac equipment and material inflation, delivery costs, and all of this while keeping their shareholders happy.
Interested to see how things will look post-midterms and especially if this IRA deal gets through the senate.
Yeah, looks like it is already 3x of the rig low count during 2020, but
near the peak of nearly 2,000 during Obama ( not shown in sampling I posted)
| 2015 | 1,683 | 1,348 | 1,109 | 976 | 889 | 861 | 866 | 883 | 848 | 791 | 760 | 711 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2016 | 643 | 532 | 477 | 437 | 407 | 417 | 449 | 481 | 509 | 543 | 580 | 634 |
| 2017 | 683 | 744 | 789 | 853 | 893 | 931 | 953 | 947 | 940 | 922 | 911 | 930 |
| 2018 | 937 | 969 | 989 | 1,011 | 1,046 | 1,056 | 1,050 | 1,050 | 1,053 | 1,063 | 1,077 | 1,077 |
| 2019 | 1,065 | 1,048 | 1,023 | 1,013 | 986 | 970 | 955 | 926 | 878 | 848 | 810 | 804 |
| 2020 | 791 | 790 | 771 | 565 | 348 | 274 | 255 | 250 | 257 | 280 | 311 | 341 |
| 2021 | 374 | 397 | 408 | 436 | 453 | 464 | 483 | 501 | 508 | 538 | 569 | 579 |
| 2022 | 601 | 636 | 662 | 690 | 719 | 738 |
We’ll never hit 2000 ever again. Most of the drilling right now is in the Permian. Every other basin has been pretty stagnate. I expect Marcellus to pickup if this new IRA deal goes through.
As far as offshore Gulf of Mexico, really depends on the IRA deal. However, even if all that acreage gets auctioned, there is uncertainty that oil companies will actually purchase those leases. Costs way too much money to be drilling in the GoM vs. onshore Shale. I think Manchin is doing what he can to save the FF industry, but who knows what demand will be in 10 years.
Oh I never say never anymore 
But you may very well be right on not
getting to 2,000 rigs operating again. We may hit 850-900 by December,
unless the CoachV Depression lands.
The demand in 10 years is the big question. It will not drop to zero, but
could be severely in decline due to continued tech. progress in EVs , batteries,
solar, wind, and hydrogen. About the only thing we will not have in 10 years
is fusion , unless there is a big breakthrough. ITER still has very distant project
timeline.
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