Permian Surge Helps Exxon and Chevron Weather Oil Slump
- Supermajors facing investor skepticism about 2020 cash flows
- Ample global crude supplies are thwarting oil price revival
Exxon Mobil operations in the Permian Basin.
Photographer: Daniel Stober/Exxon
America’s two biggest oil majors are leaning on booming shale production in the Permian Basin, the once-overlooked region in West Texas and New Mexico, to weather the gathering macroeconomic storm of lower oil demand, weak commodity prices and slowing global growth.
Exxon Mobil Corp. said Friday its production from the basin rose 70% in the third quarter compared with a year ago while Chevron Corp. reported a 35% gain. Those huge increases are likely to offset any slowdown from U.S. independent producers with smaller balance sheets, who have been struggling to generate consistent free cash flow and now find themselves under intense pressure from investors to rein in spending.