Oil industry writedowns top $80 billion mark in past year

first_imgOil industry writedowns top $80 billion mark in past year FacebookTwitterLinkedInEmailPrint分享Reuters:The world’s top energy companies have slashed the value of their oil and gas assets by around $80 billion (60.05 billion pounds) in recent months after revising lower the long-term outlook for fuel prices in the wake of the coronavirus epidemic and the energy transition.Exxon Mobil, the largest U.S. oil company, announced on Monday it would write down the value of natural gas properties by $17 billion to $20 billion, its biggest ever impairment following the sharp drop in energy prices this year. It follows similar steps by rivals including Royal Dutch Shell, BP and Chevron since late 2019.The so-called oil majors are “acknowledging overly optimistic commodity price views of yesteryear,” said Bernstein analyst Oswald Clint.Most of Exxon’s impairments focused on legacy assets from its $30 billion acquisition of U.S. shale producer XTO Energy in 2010, a deal former CEO Rex Tillerson had previously said was “ill-timed.”Following the impairments, companies will focus on the parts of the business that are able to withstand the lowest oil and gas prices, Clint said. “Balance sheets now reflect the lowest portfolio break-evens in two decades and therefore the most resilient to future commodity price shocks.”The impairments made by the European majors also came after they lowered their long-term oil prices forecasts as they prepare to increasingly switch to renewable energy in the coming decades to reduce carbon emissions to net zero.[Ron Bousso]More: Oil majors wipe $80 billion off books as epidemic, energy transition bitelast_img


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