Chevron Corp cut its capital spending budget by $4 billion on Tuesday, leading a wave of cost-cutting announcements across the reeling oil-and-gas industry as the coronavirus pandemic has slashed demand and triggered a dramatic slide in oil prices.
Chevron shares jumped 21 per cent on Tuesday to $65.73 as investors cheered the company’s budget cut, which was twice as big as analysts expected, as a sign it would not incur debt to finance operations. Shares were also buoyed by a higher U.S. stock market that was lifted by central bank stimulus measures.
The field is its “most flexible” for spending reductions. Chevron has 16 drilling rigs at work in the field now, down from 20 last year, and will drop to fewer than 8, Wirth said. Exxon Mobil, the largest U.S. oil company, has vowed to make significant cuts this year, while Norway’s Equinor also reduced its share buyback program.
globebusiness