Big Oil earnings show split in production strategy, shareholder returns
Exxon and Shell maintain buybacks amid oil price slump
Chevron and BP reduce buybacks due to market conditions
Exxon benefits from Guyana oilfield, Chevron seeks entry
By Sheila Dang and Shadia Nasralla
HOUSTON/LONDON, May 2 (Reuters) - Big Oil's first-quarter earnings have shown a clear split in how companies are positioned to weather the downturn sparked by a slump in oil prices to a four-year low in April.
Investors were focused on whether companies would cut share repurchases, since lower crude prices would leave them with less cash to fund the programs. Buybacks and dividends are key to investor interest in the oil industry. U.S. oil producer Exxon Mobil and UK-based Shell kept the pace of share buybacks. Their top rivals, U.S.-based Chevron and UK-based BP said they would reduce buybacks in the second quarter. The difference speaks to where each company is in its business cycle. Exxon has benefited from prolific production from its Guyana oilfield, the largest offshore oil find in at least a decade. A major player in the top U.S. oilfield, the Permian Basin, as well as in Guyana, Exxon increased production by 20% year-over-year. Both areas are highly profitable and the company is working to reduce its operating costs, said Exxon CEO Darren Woods.
"In this uncertain market, our shareholders can be confident in knowing that we're built for this," Woods said in the company's first-quarter earnings statement. Oil prices recorded their largest monthly drop since 2021 this week as investors priced in the expected damage to the global economy - and contingent fuel demand - from U.S. President Donald Trump's trade policies.
Exxon's net-debt-to-capital ratio was 7%. It was the only integrated oil company that did not increase net debt during the quarter, said Kim Fustier, head of European oil and gas research at HSBC.
Chevron's first-quarter oil and gas production was flat compared to the previous year as growth in Kazakhstan and the Permian was offset by loss of production from asset sales. Earlier this year, the company announced it would lay off up to 20% of its staff as part of an effort to simplify the business and cut up to $3 billion in costs. Chevron is attempting to buy into the Guyana play through the acquisition of one of Exxon's minority partners in the project, Hess. Exxon is in arbitration over that deal, and claims to have the right of first refusal for Hess' stake in the field.
Exxon repurchased $4.8 billion of shares during the first quarter, putting it on track to meet its annual target of $20 billion. Chevron said it would reduce buybacks to between $2 billion and $3.5 billion in the current quarter, down from $3.9 billion between January and March, which it said was a reflection of market conditions.
"Exxon's low-cost production gave it room to hold the line on buybacks, with Chevron pulling back as weaker oil prices bite," said Jake Behan, head of capital markets at financial products firm Direxion.
SHELL IMPRESSES, BP DISAPPOINTS In Europe, Shell's first-quarter earnings beat analyst expectations. The company said it planned to buy back $3.5 billion worth of shares over the next three months, the 14th consecutive quarter of a buyback program of at least $3 billion. BP missed earnings expectations with a 48% fall in profit to $1.4 billion and also slashed its share buyback program from around $1.8 billion to $750 million a quarter.
After the disappointing results, BP could miss consensus expectations for second-quarter earnings by 20%, said Biraj Borkhataria, an analyst at RBC Capital Markets, in a note.
"The combination of a weaker (free cash flow), higher leverage and patchy execution leaves us more cautious on the name versus peers," he wrote.
The British oil major is in the midst of a strategy change back toward oil and gas after a failed attempt to move more aggressively than rivals toward a low-carbon energy business model. BP had underperformed its biggest rivals before the downturn, making it a potential takeover target. Shell CEO Wael Sawan said on Friday he would rather buy back more of his company's own shares than bid for BP. Shell kept its investment budget at between $20 billion and $22 billion for the year, while BP said it will cut spending by $500 million, to a $14.5 billion budget.
BP also indicated it could offload more assets, increasing its outlook for asset sales this year to between $3 billion and $4 billion, from $3 billion previously. (Reporting by Sheila Dang in Houston and Shadia Nasralla in London; Editing by Rod Nickel)
First Published: 3 May 2025, 02:56 AM IST
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Mint
42 minutes ago
- Mint
Who is Nicole Daedone, the woman accused of forcing employees into sexual acts?
The founder of sexual wellness company, OneTaste Inc., and its former sales head have been convicted of forced labour charges by a Brooklyn court. The California-based company promoted 'orgasmic meditation', or 'OM', which was carried out by men manually stimulating women in a group setting. Following a five-week trial, the court on Monday found Nicole Daedone, 57, founder of OneTaste, and Rachel Cherwitz, 44, the former sales director, guilty after deliberating for less than two days, reports said. The two accused could face up to 20 years in prison. During the case hearing, prosecutors argued that Nicole and Rachel ran a years-long scheme that groomed adherents, many of them victims of sexual trauma, to do their bidding. The two women used economic, sexual and psychological abuse, intimidation and indoctrination to force OneTaste members into sexual acts such as having sex with prospective investors or clients. Assistant US Attorney Nina Gupta, in her closing statement last week, said the defendants 'built a business on the backs' of victims who 'gave everything' to them, including 'their money, their time, their bodies, their dignity, and ultimately their sanity.' 'The jury's verdict has unmasked Daedone and Cherwitz for who they truly are: grifters who preyed on vulnerable victims by making empty promises of sexual empowerment and wellness only to manipulate them into performing labor and services for the defendants' benefit,' said Joseph Nocella, US Attorney for the Eastern District of New York. Nicole Daedone of New York co-founded OneTaste in San Francisco in 2004 as a sort of self-help commune that viewed female orgasms as key to sexual and psychological wellness and interpersonal connection. Portrayed as a cutting-edge enterprise that prioritised women's sexual pleasure, the sexual wellness company generated revenue by providing courses, coaching, OM events, and other sexual practices for a fee. OneTaste enjoyed glowing media coverage in the 2010s and quickly opened centres from Los Angeles to London. Nicole sold her stake in OneTaste in 2017 for $12 million, a year before the company's marketing and labour practices were criticised. OneTaste's current owners, who have rebranded it as the Institute of OM Foundation, said its work has been misconstrued, and the charges against its former executives were unjustified. They also said sexual consent has always been a cornerstone of the organisation.
Hindustan Times
an hour ago
- Hindustan Times
Office ke bahar 10 bande le aaunga: Delhi-based business owner shares horror hiring story and threat; Reddit post viral
Hiring your first employee is stressful enough. But for one Delhi-based man, it turned into a full-blown nightmare. The original poster (OP) u/Prestigious_Cold9315 took to the Delhi subreddit to post his chilling encounter with a job candidate hired through a popular job seeking/application portal. What followed was a no show, a money ask, and a threat. This led OP to seek answers and advice from Reddit users, many of whom offered their own pearls of wisdom. The incident took place at a small family-run furniture store in Delhi. The poster (OP) (setting out to hire an employee for the very first time) recruited someone to handle basic accounting tasks using resource management software, Tally. But what followed, he says, felt like something out of a scammy social media reel. The candidate didn't show up on the scheduled joining day, citing health issues. After a delay of about three or four days, he arrived at the store — on a day that the employer wasn't even present! What's more, he called only to say that he had come to talk. The next day, the man returned, worked briefly, and asked for ₹500, claiming he needed it for an ultrasound. OP gave him the money, only to then be ghosted for several more days. When contacted again, this employee demanded more money — ₹350 to be exact — claiming it as was the balance for his one day of work (going by an ₹850 dihadi). When refused? He threatened the employer, saying: 'Main Jaat hoon. Office ke bahar 10 bande le aaunga kal.' Safe to say OP took it as a wake up call, seeking advice to mend his hiring ways. Commenters on the post were quick to label the employee a 'fraud', warning against recruiting anyone without comprehensive background checks, vetting the CV, and following up on the reccomendations. 'You my friend ended up hiring a fraud. Anyway he will not do anything. Block him and do your work. Hire someone else and do a proper background check,' shared one user, ad another adviced, 'Keeps the call on record next time. File a complaint if he threatens again.' Another suggested a legal recourse: 'File a police complaint. Let the police handle this. Get an employment contract in place in future if you don't.' Some users also felt that taking a threat for sucha low amount should not be taken so seriously. 'Don't think so this person can do much if he's threatening for 350rs. Also, why was he asking for the money if he didn't show up for 3 more days?' commented a user. Another suggested reporting and flagging off the profile on the hiring portal, 'If you can, figure out how to report his profile to naukri. Send him a formal email saying he's been paid 500 for x number of hours (if he indeed did any work). Let him know his employment is terminated. Let him know, if he treathens you further, ki woh 35rs ke liye 10 bande layega toh wakai gazab hojayega. Formally likh dena that as he didn't work, he won't get paid. And him contacting you further will result in your filing a police complaint against him. Bus. Don't be scared. Barking dogs seldom bite and ig you have cameras? Let him know too. For your protection, you can let the police know if you're really scared.' The employer is now looking into how to report the incident and flag the profile on the job portal. Meanwhile, users continue to offer advice: conduct proper background checks, issue offer letters with clear terms, and — most importantly — never give money casually, even in emergencies. Whether this threat materialises or not, the post has hit a nerve with small business owners and first-time recruiters across social media — especially those navigating the complex hiring landscape without the cushion of a corporate HR team.
Time of India
an hour ago
- Time of India
Canada to hit NATO defence spending target in 2025, five years early, marking shift from US reliance
Canada Prime Minister Mark Carney walks Chief of the Defence Staff, General Jennie Carignan and Minister of National Defence David McGuinty, right, as he prepares to make an announcement at Fort York Armoury in Toronto, Canada, on Monday, June 9, 2025. (Chris Young/The Canadian Press via AP) Canada will meet NATO's 2% defence spending target this fiscal year, five years ahead of schedule, Prime Minister Mark Carney announced. The move marks a strategic shift in Canada's defence posture, with a focus on modernising military infrastructure and reducing reliance on the United States. The government plans to invest in new equipment, boost troop pay, and explore European defence partnerships. Carney's announcement reflects growing geopolitical tensions and a call for Canada to assert greater independence on the global stage. Tired of too many ads? Remove Ads Billions committed to military overhaul Ageing equipment and recruitment struggles Tired of too many ads? Remove Ads A strategic shift away from the United States NATO allies eye higher spending targets Tired of too many ads? Remove Ads Turning to Europe for defence partnerships A new era of Canadian defence policy Canada will hit NATO's defence spending target of 2% of GDP this fiscal year, Prime Minister Mark Carney confirmed on Monday. The announcement, made during a speech at the University of Toronto, marks a major policy shift and accelerates the timeline by five years from the previous Liberal government's plan.'I am announcing today that Canada will achieve NATO's 2% target this year — half a decade ahead of schedule,' Carney said. 'Now is the time to act with urgency, force, and determination.'The government will inject CA$9 billion into defence this year, raising total spending to CA$62.7 billion. This includes CA$2.5 billion allocated to defence-related activities in other departments, such as the Canadian Coast Guard, which will now be integrated into the laid out a sweeping plan to modernise Canada's armed forces. 'We will invest in new submarines, aircraft, ships, armed vehicles and artillery, as well as new radar, drones and sensors to monitor the seafloor and the Arctic,' he military has long faced operational challenges. 'Only one of our four submarines is seaworthy. Less than half of our maritime fleet and land vehicles are operational. More broadly we are too reliant on the US,' Carney said.A large portion of this year's spending will go toward repairing broken equipment and improving pay and benefits for military personnel. The aim is to address a severe recruitment crisis and restore operational readiness.'We will repair and maintain our ships, our aircraft and infrastructure that for too long we allowed to rust and deteriorate,' Carney speech signalled a clear pivot in Canada's defence posture. He warned that the world is becoming more dangerous and that Canada must reduce its reliance on the United States.'In a darker, more competitive world, Canadian leadership will be defined not just by the strength of our values, but also by the value of our strength,' he criticised the evolving role of the U.S. under President Donald Trump. 'The United States is beginning to monetise its hegemony: charging for access to its markets and reducing its (relative) contributions to our collective security. We should no longer send three-quarters of our defence capital spending to America.'Carney also addressed the historical alliance. 'We stood shoulder to shoulder with the Americans throughout the Cold War and in the decades that followed, as the United States played a predominant role on the world stage. Today, that predominance is a thing of the past,' he said in added that after the fall of the Berlin Wall, the U.S. became the global hegemon and Canada's dominant trading partner. But that era, he suggested, is announcement comes as NATO allies consider raising the bar. NATO Secretary-General Mark Rutte said last week that most U.S. allies support Trump's call for members to spend 5% of GDP on defence.'We are meeting 2%. And that is the NATO target as it is today,' Carney said at a later news conference. 'We will need to spend more.' He confirmed that discussions on increased spending and timelines will take place at the upcoming NATO is actively seeking to diversify its defence procurement. Carney's government is reviewing the planned purchase of U.S.-made F-35 fighter jets and exploring European alternatives.'We should no longer send three-quarters of our defence capital spending to America,' Carney reiterated. Canada is in talks with the European Union to join a broader EU initiative aimed at reducing security dependence on the shift aligns with a wider trend. Since Russia's full-scale invasion of Ukraine in February 2022, European allies and Canada have ramped up investments in weapons, ammunition, and military rise to power was fuelled in part by his promise to confront what many Canadians see as growing aggression from the Trump administration. Trump's past remarks suggesting Canada should become the 51st U.S. state have stirred national outrage.'The long-held view that Canada's geographic location will protect Canadians is increasingly archaic,' Carney said. 'A new imperialism threatens.'As told to CNN, defence analysts have welcomed the announcement. Margaret McCuaig-Johnston, a senior fellow at the University of Ottawa, called it 'a long-overdue announcement' and noted the challenge ahead. 'This significant commitment is remarkable given how quickly they're going to have to move to make 2% by the end of the fiscal year,' she she cautioned that more funding will be needed to fully realise the government's ambitious plans.(With inputs from Reuters, AP)
