博彩对冲

US majors Chevron and Exxon are diverging in their reactions 鈥� or lack thereof, so far 鈥� to falling oil prices and a souring economic outlook.

During its first-quarter earnings call on Friday, Chevron announced that it is reducing its share buyback range for the second quarter to $2.5 billion-$3 billion, down from the $3.9 billion it allocated in the January-March period.

That puts the company's full-year buyback program at $11 billion-$13 billion, at the lower end of the $10 billion-$20 billion annual target it introduced in 2023. The bottom of that range assumed a Brent oil price of $60 per barrel over the 2023-27 period, while the top assumed an average of $85/bbl.

In London, Brent crude for July loading settled at $61.29/bbl on Friday.

Exxon, meanwhile, told analysts during its earnings call that it is maintaining its annual buyback program at $20 billion despite growing economic headwinds.

"In this environment, it's more important than ever to focus on what we can control and this company's track record of delivery," Exxon CEO Darren Woods said. "The work we've done over the past eight years should make one thing clear: We're ready for this."

Woods touted Exxon's net debt-to-capital ratio of 7% 鈥� up from 6% in the fourth quarter 鈥� which "leads large-cap industrials and all IOCs [international oil companies] in a lean cost base."

鈥淓xxon states 鈥榳e are built for this鈥� (a weaker macro) and says 鈥榦thers are just getting started鈥� on cost reductions, while Exxon has already done the heavy lifting 鈥� and they鈥檙e not wrong,鈥� Kim Fustier, head of European oil and gas research at investment bank HSBC, said in a note.

The same ratio for Chevron stood at 14.4% in the first quarter, up a full four percentage points from the October-December period.

Financial Flexibility

Chevron CEO Mike Wirth assured investors that Chevron is well prepared to lower its capital spending as needed if oil prices continue to weaken, with almost two-thirds of the company's capex allocated to either short-cycle US shale assets or projects that are set to be completed in the short term.

"Chevron has a proven track record of managing through uncertainty in commodity cycles, and with long-standing financial priorities as our guide, we're well-positioned to win in any environment," he said. "We've shown, [what] I would call, discipline coming into this year by tightening our belt a notch and in bringing capital down a little bit. But if we needed to bring capital down further, you know, we certainly could do so."

Exxon's Woods also stressed its preparedness for a downturn and said it is closely monitoring the market.

鈥淚f we can improve the NPV [net present value] of our investments by inventorying opportunities for later, we will do that,鈥� Woods said. 鈥淭he flexibility of our investment portfolio, with over a third of our production coming from short-cycle US unconventional assets, gives us this option."

Tariff Troubles

Wirth said in response to a question that Chevron is keeping a close eye on the impact that US tariffs are having on the market.

"We're watching this very closely and preparing, and actually in the process of taking some actions to mitigate the impacts" of tariffs, he said. Our direct exposure is relatively limited ... The impact is not zero, but I think the impact is manageable."

Wirth estimated that tariffs could increase the cost of a shale well by about 1%.

"So it's a dynamic environment, and we'll watch how these things evolve," he said. "But we've got strong engagement with our suppliers. We've got sourcing from multiple locations. And we've been anticipating this and preparing for it."

Wirth highlighted that Chevron has "strong" domestic sourcing for most of the goods that it uses in its unconventional assets in the Denver-Julesburg Basin in Colorado and the Permian Basin in Texas and New Mexico.

Exxon's Woods largely echoed Wirth, acknowledging that his company is "certainly not immune" to the impact of tariffs but that it is well-positioned for whatever may come. He added that "we haven't seen any significant issues or impact" from tariffs and that Exxon is "not forecasting any."

The Exxon chief suggested that projects that are already in progress are relatively insulated from the trade turmoil, but that projects for which a final a final investment decision (FID) has not been made yet could be more vulnerable.

"I would say, generally speaking, for the things that are in flight, where we've got work going on, contracted things we've FID-ed, I think the way we've structured those contracts and the position where we're at with each of those, we're pretty well shielded from the impacts of tariffs," he said. "What ... has more exposure to things [are] the new things that are coming down the pipe, and how the tariffs play out ... will drive the impact it potentially has on those projects."