As the world oil rate decreases from $100 per barrel to $50 since April last year, it rendered some of the Exxon projects worthless with no profit at all. After facing a downfall, they are going to alter the company’s spending by 12% to $34 billion.
Exxon Mobil Corporation is on the verge of poor performance. Exxon Mobil stock, going downwards 4.6 percent per share, is experiencing the worst loss in a day after August 2011.
Exxon was 4.8 percent down in July, whereas Chevron fell by 8.3% in the same month. Collectively, over this year Exxon Mobil shares are 14% down, a great fall for any company to recover. Wall Street anticipated earlier on Friday about quarterly earnings that the oil company will be seen down.
The CEO and Chairman of Exxon Mobil, Rex Tillerson, states about the variation of their company, "Our quarterly results reflect the disparate impacts of the current commodity price environment, but also demonstrate the strength of our sound operations, superior project execution capabilities, as well as continued discipline in capital and expense management.”
The huge drop in crude oil rates also affected the results of Chevron, the oil producer. John Watson, Chevron’s CEO, clearly stated about the financial position of the company in a statement, "Second quarter financial results were weak, reflecting a crude price decline of nearly 50% from a year ago."
Their fast running business was seriously cracked by the fall of oil prices turnovers, which brought out massive destruction to their reputed business. Mr. Watson acknowledged about the improvement in refining, purification, and processing of crude oil, which can give the best financial support by saying that, "Downstream operations continued to deliver strong financial performance, reflecting both high reliability and improved margin."
One of the best and superior oil organizations, Shell, announced yesterday that they have downsized around 6,500 workers, as they are facing a fall in their revenues because of continuous fall in oil rates.
All oil majors in industry are experiencing disruptions in their earnings, which resulted in thousands of jobless workers. These companies have started reviewing their criteria by adjusting their techniques to pull even more oil and gas out of wells, to collect the quantity by which they can cover up their losses or expenditure at least.
It is necessary to bring a quick responsive change in their strategies because industry officials do not expect energy prices to be accelerated anytime soon. At an official meeting last week, Exxon Mobil CEO said about the falling rates, “the low prices are going to be with us for some time."
After the recession in oil prices, the Exxon Mobil stock market also brings the decrease in valuation, as the company is returning money to its shareholders continuously.
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