Petchem giants post disappointing results amid debate on oil output-cut
Supply concerns were exacerbated within OPEC particularly after sanctions on Iran were officially ended. The country’s oil production spiked in January. According to media reports, Iran is reluctant to restrain supply as it wants to recover market share and feels that the economic benefits of lifting sanctions offset the drop in oil prices.
When oil production is closely being watched all over the world and players are wondering whether crude will hold above $30/bbl or break below this threshold again, many major petrochemical producers revealed their financial results on a disappointing note.
The most striking news came from Chevron who posted a loss for the first time in 13 years. A glut of crude from the Persian Gulf and North American shale fields has collapsed prices, forcing the company to write down the value of its fields, according to media reports. Chevron’s fourth-quarter net loss was $588 million compared with profit of $3.5 billion a year earlier.
BP also reported a 91% decline in fourth-quarter earnings at $196 million from a year earlier profit of $2.24 billion due to the same reason. Another super-major oil producer, Exxon, followed suit as its profits tumbled by 58% for the last quarter to $2.78 billion from a year before.
LyondellBasell also revealed a worse-than-expected revenue for the last quarter, which fell 31% to $7.07 billion from a year prior. However, there was a slight improvement in the company’s profit at $795 million on a yearly basis.
French oil major Total is also likely to report an adjusted net profit close to $10 billion for 2015 down by more than 20% on the year, the company CEO said, before official results are posted on February 11. Shell already warned investors too on Jan 20 that fourth-quarter profit probably fell at least 42% from a year earlier while the official results are expected on February 4.
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