00:00I wanted to get your take, first of all, on oil prices, which at the moment aren't doing a whole lot.
00:04But there were a flurry of reports today about how the U.S. might take further action against Venezuela.
00:09That's right. We saw some headlines earlier this morning from, I think, the Miami Herald saying that it was pretty definitive the U.S. was going to take military action.
00:17The price reaction was pretty immediate. We saw WTI up over 1 percent and then moderate rates of those gains.
00:24And then I think later on we had Donald Trump saying in a press gaggle that as of now there are no attacks and that cooled things a little.
00:31So the market's still a little nervous out there despite this emerging sort of glots we're going to see over the next year or so, as you just heard.
00:39The geopolitical risk premium, I guess you could call it, it's still there. People are still nervous.
00:46People are still nervous. But for now, even as Dan Stryven was talking about production maybe ramping up in 2027, there's a lot of supply of oil right now.
00:53And the different oil companies are responding to it differently.
00:56You've got ExxonMobil and Chevron pursuing pretty much divergent paths.
01:01What did their latest results tell us about that?
01:03Well, as you say, they both beat. I mean, operationally, there were real big missteps.
01:08They're both doing pretty well in their own way. But there is a divergence.
01:11Exxon is extremely sort of gung-ho on production right now.
01:14It's expanding in the Permian Basin down in Texas.
01:17It revealed actually that during this previous quarter, it quietly mopped up extra acreage.
01:22It bought some acreage from a Chinese oil company on the quiet.
01:25So it's just expanding more and more down there.
01:28It's had record production in Guyana, which is one of the big focuses for that company.
01:34Chevron now is in Guyana as well with the Hess acquisition.
01:36So this quarter was the first time those Hess earnings have been sort of incorporated, the Hess production from Guyana.
01:43But it's taking a more conservative approach.
01:45It's actually hitting some pause on expansion in the Permian.
01:49It's not ruling it out in the future.
01:51But it's being a little bit more cautious as we go into what everyone expects is going to be a glutted market.
01:57So Exxon spent $2.4 billion on what it calls growth acquisitions.
02:02And it feels very much like it's moving forward.
02:03It's aggressive with these expansion projects despite crude staying at these levels.
02:08Is it more aggressive because it's working from a position of strength or weakness?
02:12What's your take?
02:13It's strong.
02:14It's got a very good balance sheet.
02:16It came out of the pandemic.
02:19If you go back five years, the oil industry was in a tough spot.
02:22It's like most of the biggest oil companies here in the U.S.
02:25It's shed a lot of jobs.
02:26It's cut thousands of jobs.
02:27It's really screwed down on those prices.
02:30Their cost of production as a company is relatively low, both in U.S. terms, global terms as well.
02:36You talk to Darren Woods, he will tell you they see a long-term advantage.
02:40They plan 10 years out or even longer.
02:43This is an opportunity for them to gain market share.
02:46Even if prices come down from where we are at the moment, I think Brent is around $60 a barrel.
02:52That's causing some producers pause for thought.
02:55It doesn't give Exxon much sleepless nights at the moment.
02:59They have lower profits.
03:00The cash is still flowing.
03:02They can plan for the long term.
03:03Okay, but they did the hard work in terms of really cutting costs earlier.
03:07In terms of where oil prices stand and where they go from here, Chevron sees the oil price
03:12slump persisting for a while, doesn't it?
03:14It does.
03:14It does.
03:15I mean, to be realistic, we're all seeing more production coming from OPEC.
03:18We've got this OPEC meeting this weekend.
03:21The expectation is they're probably going to add to another increase in production for December
03:27to follow the ones we're going to see in October and November.
03:30There's more production coming on from those guys.
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