Oil majors wipe $80 billion off books as epidemic, energy transition bite
By Ron Bousso:
By Ron Bousso
LONDON (Reuters) – The world’s top energy companies have slashed the value of their oil and gas assets by around $80 billion (60.05 billion pounds) in recent months after revising lower the long-term outlook for fuel prices in the wake of the coronavirus epidemic and the energy transition.
Exxon Mobil, the largest U.S. oil company, announced on Monday it would write down the value of natural gas properties by $17 billion to $20 billion, its biggest ever impairment following the sharp drop in energy prices this year.
It follows similar steps by rivals including Royal Dutch Shell, BP and Chevron since late 2019.
For graphic of Downsizing: https://graphics.reuters.com/OIL-WRITEDOWNS/qmypmxlrovr/chart.png
The so-called oil majors are “acknowledging overly optimistic commodity price views of yesteryear,” said Bernstein analyst Oswald Clint.
Most of Exxon’s impairments focused on legacy assets from its $30 billion acquisition of U.S. shale producer XTO Energy in 2010, a deal former CEO Rex Tillerson had previously said was “ill-timed.”
Following the impairments, companies will focus on the parts of the business that are able to withstand the lowest oil and gas prices, Clint said.
“Balance sheets now reflect the lowest portfolio break-evens in two decades and therefore the most resilient to future commodity price shocks.”
Exxon did not disclose its new commodity price outlook. The value of the oil majors plummeted in 2020 after energy demand collapsed due to the pandemic.
The shares of Exxon, Shell and BP have lost over 45% so far this year, more than benchmark Brent oil prices that have lost around 27% and stand today near $48 a barrel.
The impairments made by the European majors also came after they lowered their long-term oil prices forecasts as they prepare to increasingly switch to renewable energy in the coming decades to reduce carbon emissions to net zero.
The revisions might nevertheless lead to a sharp rise in oil prices in the coming years as a result of lower investments in new projects, Clint said.
“We’re staring into the abyss when it comes to supply and demand balances due to a dearth of much needed capital investment.”
(Reporting by Ron Bousso; Editing by Chizu Nomiyama)
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Royal Dutch Shell conspired directly with Hitler, financed the Nazi Party, was anti-Semitic and sold out its own Dutch Jewish employees to the Nazis. Shell had a close relationship with the Nazis during and after the reign of Sir Henri Deterding, an ardent Nazi, and the founder and decades long leader of the Royal Dutch Shell Group. His burial ceremony, which had all the trappings of a state funeral, was held at his private estate in Mecklenburg, Germany. The spectacle (photographs below) included a funeral procession led by a horse drawn funeral hearse with senior Nazis officials and senior Royal Dutch Shell directors in attendance, Nazi salutes at the graveside, swastika banners on display and wreaths and personal tributes from Adolf Hitler and Reichsmarschall, Hermann Goring. Deterding was an honored associate and supporter of Hitler and a personal friend of Goring.
Deterding was the guest of Hitler during a four day summit meeting at Berchtesgaden. Sir Henri and Hitler both had ambitions on Russian oil fields. Only an honored personal guest would be rewarded with a private four day meeting at Hitler’s mountain top retreat.
IN JULY 2007, MR BILL CAMPBELL (ABOVE, A RETIRED GROUP AUDITOR OF SHELL INTERNATIONAL SENT AN EMAIL TO EVERY UK MP AND MEMBER OF THE HOUSE OF LORDS: 
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