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ConocoPhillips Reports Worse-Than-Expected Loss As Oil Plunged

Total production, excluding Libya, fell about 24% to 981,000 barrels of oil equivalent per day (boepd) in the second quarter.

Image: Platform in Eldfisk, North Sea. Source: ConocoPhillips

By Nishara Karuvalli Pathikkal

(Reuters) – ConocoPhillips reported a wider-than-expected loss on Thursday, as coronavirus-induced lockdowns sapped demand for fuel and crushed crude prices, sending shares of the world’s largest independent oil and gas producer down nearly 9% this morning before recovering about half of those losses.

The pandemic brought travel and other businesses to a halt under lockdowns and led to a glut of oil and gas, forcing widespread output cuts by bleeding producers.

Second-quarter earnings for ConocoPhillips from each barrel sold more than halved, as U.S. light crude and Brent crude average prices also fell more than 50%.

Major oil players such as BP, Chevron and Exxon Mobil are also expected to report rare losses, hammered by the price plunge, but Royal Dutch Shell avoided its first quarterly loss in recent history by relying on a booming trading business.

Analysts at RBC Capital Markets noted a lack of operational color in ConocoPhillips’ statement and said they were surprised it did not update guidance that was suspended in April.

The company, which cut about a third of its production early in the quarter when prices fell, brought back much of its curtailed volume over June as crude prices recovered some of the losses.

Total production, excluding Libya, fell about 24% to 981,000 barrels of oil equivalent per day (boepd) in the second quarter.

Adjusted net loss stood at 92 cents per share, wider than analysts’ average estimate of 58 cents per share loss.

The Houston-based company realized a gain of $594 million on completing the divestiture of its Australia-West assets to Santos Ltd and an unrealized gain of $551 million on its stake in Cenovus Energy.

Shares of the company were down 5% at $7.94 in midday trade.

Reporting by Nishara Karuvalli Pathikkal in Bengaluru; Editing by Shinjini Ganguli.


Source: Reuters

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