NEW YORK - Oil companies PetroChina Co, Suncor Energy and Hess Corp recorded higher quarterly earnings on Wednesday, but Hess joined the growing list of producers to cut its planned spending in the wake of the selloff in oil prices.
Shares in nearly all the oil and gas producers climbed in Wednesday trading as crude oil prices showed a rare jump after hitting 15-month lows in the United States earlier this week.
The sagging global economy and selloff that has more than halved crude oil prices since early July have put some new expensive oil and gas production projects in doubt.
"Based upon this uncertain economic environment, we will make an appropriate reduction in our 2009 capital and exploratory expenditures to maintain our financial strength," Hess CEO John Hess told analysts on the company's conference call.
Suncor Energy (SU.TO: Quote, Profile, Research, Stock Buzz), Canada's second biggest oil sands producer, said last week it had delayed the completion of the C$20.6 billion Voyager project by a year because of the declining oil price.
Canada's oil sands have become one of the largest production growth regions in the world, but the high cost of extracting and processing the oil has put some of those projects in doubt as oil prices have eased.
U.S. crude oil futures prices averaged $118 a barrel during the quarter, as the rally that lifted them to a peak at $147 in early July gave way to a selloff of more than 50 percent at the end of the quarter.
On Wednesday, crude oil futures on the New York Mercantile Exchange rose nearly $4 to $66.60 a barrel, a bounce of more than $3 from the lows hit on Monday.
That gain helped boost most energy shares, one analyst said.
"For these guys, there's usually not a lot of (earnings) surprises. You know what the pricing in the quarter was, and everybody's production so far has been within forecasts. The strength is coming from the market in general and the jump in crude," said Phil Weiss, energy analyst at Argus Research.
CHINESE RESULTS MIXED
Asia's top oil and gas producer, PetroChina Co Ltd (0857.HK: Quote, Profile, Research, Stock Buzz) (PTR.N: Quote, Profile, Research, Stock Buzz), posted a 30 percent increase in profit to $5.8 billion, but Sinopec (0386.HK: Quote, Profile, Research, Stock Buzz), the top Asian refiner, said its profits slumped 39 percent.
Sinopec blamed the drop on the high oil price that eroded its margins. The company supplies oil products to China, where the government holds fuel at low prices in an effort to keep inflationary pressures at bay.
China raised it prices for gasoline and diesel by 18 percent in June, but policy makers in the world's second-largest oil market could cut those levels because of the recent slide in energy prices on the world market.
Suncor reported a 30 percent increase in third-quarter profit but fell short of analysts' forecasts. Its production volumes were hurt by unplanned maintenance, limiting Suncor's ability to capitalize on the high crude oil prices during the quarter.
Hess Corp (HES.N: Quote, Profile, Research, Stock Buzz) said its quarterly profit rose nearly 50 percent to $775 million on higher oil prices and improved refinery margins, but results fell short of Wall Street forecasts.
In Italy, oilfield services company Saipem SpA (SPMI.MI: Quote, Profile, Research, Stock Buzz) said its net profit climbed 29 percent and it raised its full-year growth forecast, but shied away from looking further ahead.
"With regard to medium-term expecations, it is still too early to be able to fully assess the impact on the oil and gas industry of the expected slowdown in the world economy," it said.
Also on Wednesday, Noble Energy Inc (NBL.N: Quote, Profile, Research, Stock Buzz) posted a 44 percent jump in quarterly earnings and Cairn India Ltd (CAIL.BO: Quote, Profile, Research, Stock Buzz), the Indian arm of Britian's Cairn Energy Plc (CNE.L: Quote, Profile, Research, Stock Buzz), said its net profit soared 12-fold.
Murphy Oil Co (MUR.N: Quote, Profile, Research, Stock Buzz) and Canadian Oil Sands (COS_u.TO: Quote, Profile, Research, Stock Buzz) are scheduled to release quarterly earnings after market close on Wednesday and Exxon Mobil (XOM.N: Quote, Profile, Research, Stock Buzz) will report on Thursday.
Shares in nearly all the oil and gas producers climbed in Wednesday trading as crude oil prices showed a rare jump after hitting 15-month lows in the United States earlier this week.
The sagging global economy and selloff that has more than halved crude oil prices since early July have put some new expensive oil and gas production projects in doubt.
"Based upon this uncertain economic environment, we will make an appropriate reduction in our 2009 capital and exploratory expenditures to maintain our financial strength," Hess CEO John Hess told analysts on the company's conference call.
Suncor Energy (SU.TO: Quote, Profile, Research, Stock Buzz), Canada's second biggest oil sands producer, said last week it had delayed the completion of the C$20.6 billion Voyager project by a year because of the declining oil price.
Canada's oil sands have become one of the largest production growth regions in the world, but the high cost of extracting and processing the oil has put some of those projects in doubt as oil prices have eased.
U.S. crude oil futures prices averaged $118 a barrel during the quarter, as the rally that lifted them to a peak at $147 in early July gave way to a selloff of more than 50 percent at the end of the quarter.
On Wednesday, crude oil futures on the New York Mercantile Exchange rose nearly $4 to $66.60 a barrel, a bounce of more than $3 from the lows hit on Monday.
That gain helped boost most energy shares, one analyst said.
"For these guys, there's usually not a lot of (earnings) surprises. You know what the pricing in the quarter was, and everybody's production so far has been within forecasts. The strength is coming from the market in general and the jump in crude," said Phil Weiss, energy analyst at Argus Research.
CHINESE RESULTS MIXED
Asia's top oil and gas producer, PetroChina Co Ltd (0857.HK: Quote, Profile, Research, Stock Buzz) (PTR.N: Quote, Profile, Research, Stock Buzz), posted a 30 percent increase in profit to $5.8 billion, but Sinopec (0386.HK: Quote, Profile, Research, Stock Buzz), the top Asian refiner, said its profits slumped 39 percent.
Sinopec blamed the drop on the high oil price that eroded its margins. The company supplies oil products to China, where the government holds fuel at low prices in an effort to keep inflationary pressures at bay.
China raised it prices for gasoline and diesel by 18 percent in June, but policy makers in the world's second-largest oil market could cut those levels because of the recent slide in energy prices on the world market.
Suncor reported a 30 percent increase in third-quarter profit but fell short of analysts' forecasts. Its production volumes were hurt by unplanned maintenance, limiting Suncor's ability to capitalize on the high crude oil prices during the quarter.
Hess Corp (HES.N: Quote, Profile, Research, Stock Buzz) said its quarterly profit rose nearly 50 percent to $775 million on higher oil prices and improved refinery margins, but results fell short of Wall Street forecasts.
In Italy, oilfield services company Saipem SpA (SPMI.MI: Quote, Profile, Research, Stock Buzz) said its net profit climbed 29 percent and it raised its full-year growth forecast, but shied away from looking further ahead.
"With regard to medium-term expecations, it is still too early to be able to fully assess the impact on the oil and gas industry of the expected slowdown in the world economy," it said.
Also on Wednesday, Noble Energy Inc (NBL.N: Quote, Profile, Research, Stock Buzz) posted a 44 percent jump in quarterly earnings and Cairn India Ltd (CAIL.BO: Quote, Profile, Research, Stock Buzz), the Indian arm of Britian's Cairn Energy Plc (CNE.L: Quote, Profile, Research, Stock Buzz), said its net profit soared 12-fold.
Murphy Oil Co (MUR.N: Quote, Profile, Research, Stock Buzz) and Canadian Oil Sands (COS_u.TO: Quote, Profile, Research, Stock Buzz) are scheduled to release quarterly earnings after market close on Wednesday and Exxon Mobil (XOM.N: Quote, Profile, Research, Stock Buzz) will report on Thursday.
