DALLAS (AP) – Motorists are saving billions on cheaper gasoline, but the long slump in oil prices is taking a heavy toll on companies that find and produce crude.
Exxon Mobil posted its smallest quarterly profit in more than 16 years Friday, while Chevron lost $725 million, its worst showing since 2002, and raised the number of jobs it expects to cut this year from 7,000 to 8,000. Other oil companies are expected to report weak earnings in the next few days.
Oil prices have tumbled from their 2014 highs of over $100 a barrel, bottoming out at under $30 in mid-February, because of a worldwide glut. Giant companies like Exxon and major petroleum-producing countries such as Saudi Arabia have continued to pump more from the ground despite the slide in prices.
Forecasters expect U.S. shale producers to cut production, however, which could ease the glut, and prices have been recovering over the past three months. Benchmark U.S. crude is trading at close to $46. Exxon and Chevron stock have gained ground.
“Investors are really focused on where things are heading, and that is higher oil prices,” said Brian Youngberg, an analyst with Edward Jones.