The two largest U.S. oil companies reported their lowest first-quarter profits in years on Friday as they braced for the economic fallout from President Trump’s trade war, which has weakened consumer confidence and pushed oil prices down.
U.S. crude prices slipped under $60 a barrel this week, a threshold below which many companies cannot make money drilling new wells. Crude oil is now about $20 a barrel cheaper than it was just before Mr. Trump took office. Not only is oil fetching less, companies are paying more for steel and other materials because of tariffs the president has imposed.
There are signs that some companies are already pulling back.
As of last week, the number of rigs drilling wells in the Permian Basin, the largest U.S. oil field, had fallen 3 percent in a month, according to Baker Hughes, an oil field service provider. That company’s customers have been putting off discretionary expenses, and spending across the industry is likely to fall this year, Baker Hughes executives said last week.
“We are seeing significant downward pressure on prices and margins. In this environment, it is more important than ever to focus on what we can control,” Darren Woods, chief executive of Exxon Mobil, told analysts on Friday.
The financial results reported by Exxon, the largest U.S. oil and gas company, and Chevron reflect the market before Mr. Trump announced his latest round of tariffs. Around the same time, the oil cartel known as OPEC Plus surprised the market by saying its members would speed up plans to pump more oil.
Exxon’s reported profit of $7.7 billion in the first three months of the year, down about 6 percent from a year earlier.
Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.
Thank you for your patience while we verify access.
Already a subscriber? Log in.
Want all of The Times? Subscribe.
