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Oil Profits Slump as Higher Spending Fails to Lift Output

Investors are shunning the world’s biggest oil companies as drilling costs surge, major projects are delayed and energy prices stagnate.

Crude and natural gas producers from Royal Dutch Shell Plc to ConocoPhillips began issuing profit warnings three weeks ago as they tallied the extent of fourth-quarter disappointments. Shareholders have punished the stocks, making the energy sector the worst performer in the MSCI World Index this year, in anticipation of bleak earnings disclosures later this week.