• 2 minutes Rational analysis of CV19 from Harvard Medical School
  • 4 minutes While U.S. Pipelines Are Under Siege, China Streamlines Its Oil and Gas Network
  • 7 minutes Renewables Overtake Coal, But Lag Far Behind Oil And Natural Gas
  • 5 hours China wields coronavirus to nationalize American-owned carmaker
  • 1 min Joe Biden the "Archie Bunker" of the left selects Kamala Harris for VP . . . . . . Does she help the campaign ?
  • 15 hours Open letter from Politico about US-russian relations
  • 9 mins Trump Hands Putin Major Geopolitical Victory
  • 1 day US will pay for companies to bring supply chains home from China: Kudlow - COVID-19 has highlighted the problem of relying too heavily on one country for production
  • 3 days Trumpist lies about coronavirus too bad for Facebook - BANNED!
  • 5 hours COVID&life and Vicious Circle: "Working From Home Is Not Panacea For Virus"
  • 3 days China's impending economic meltdown
  • 1 day Trump is turning USA into a 3rd world dictatorship
  • 15 hours Oil Tanker Runs Aground in Mauritius - Oil Spill
  • 2 days Liquid Air Battery
  • 2 days What the heroin industry can teach us about solar power (BBC)
  • 3 days The Truth about Chinese and Indian Engineering
Tsvetana Paraskova

Tsvetana Paraskova

Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. 

More Info

Premium Content

Exxon May Finally Book Major Writedowns

ExxonMobil could write down the value of its oil and gas assets as soon as this month, Wall Street analysts told Reuters on Friday.

Unlike many of its peers, Exxon hasn’t booked major writedowns since oil prices crashed earlier this year.

Where OccidentalBP, and Shell, have all adjusted the value of their assets, Exxon has not. In fact, it hasn’t been doing much of that over the past decade at all. 

Last month, BP and Shell lowered their oil price forecasts, which led to up to US$17.5 billion impairment charge at BP and up to a US$22 billion charge at Shell.   

Exxon has long explained the lack of huge writedowns – compared, for example, to Chevron’s US$11-billion impairment charge in Q4 2019 mostly in Appalachian natural gas – with the fact that it books the value of new oil and gas fields very conservatively and doesn’t adjust values to short-term price trends.

But as the future outlook of global oil demand and oil prices weakened after the crisis, analysts now see Exxon booking writedowns, although they refrained from estimating how much the potential impairment charges might be. 

Cowen analyst Jason Gabelman told Reuters that the global oil sector was “clearly altering its view on the value of assets and we would not be surprised if Exxon followed suit.”

According to Jennifer Rowland, an oil and gas analyst with Edward Jones, Exxon could “start to lose credibility if they don’t take a writedown soon.”

On Thursday, Exxon warned in an SEC filing that it could be in for booking its second consecutive loss in Q2 as the oil price collapse and weak refining margins hit both the upstream and downstream divisions of the U.S. supermajor. Exxon sees the lower oil and natural gas prices decreasing its upstream operating profit by anywhere from US$2.5 billion to US$3.1 billion. In the downstream, a change in North American crude logistics differentials and weak refining margins are set to eat between US$800 million and US$1.2 billion of the operating profit.

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News