WASHINGTON - The current credit crisis, along with falling crude prices and lower petroleum demand, will result in a review on whether to go forward with some oil projects, executives with two large U.S. oil companies said on Thursday.
"We are looking at our plans," said Ryan Lance, ConocoPhillips' (COP.N: Quote, Profile, Research, Stock Buzz) president for exploration and production in Europe, Asia, Africa and the Middle East.
"We certainly can't afford what we were thinking we could afford even a month ago going into the next couple of years. So, we absolutely are looking back at our plans," Lance said at a policymakers conference sponsored by the National Council on U.S.-Arab Relations.
Lance said current U.S. crude oil prices of around $60 to $65 a barrel, down from a record $147 in July, "do impact our cash flows."
Jay Pryor, Chevron's (CVX.N: Quote, Profile, Research, Stock Buzz) vice president for corporate business development, said some of his company's projects could be affected by contractors or subcontractors that cannot get the money to buy the necessary materials or provide the services for Chevron projects.
"So there's going to be some delay that is naturally associated with the financial crisis and some of the (oil) demand destruction I think," he said. "We're just starting to see the beginnings of that. So that is a bit concerning."
As a result, Pryor said Chevron might have to rethink some of its projects.
"You might not be able to deliver exactly what you planned to deliver. So, we've got to really analyze that in a lot of detail," he said.
Neither executive would name any specific oil projects that might be put on hold, but they said those projects that were about to get started could be affected. Both emphasized that projects already under way would likely continue because their companies take a long-term view with their business plans.
"You can't as an industry afford to stop investing. If you stop investing, the (oil) supply can drop as much as 10 percent in a year," said Pryor. "The last thing you want to do is jerk the wheel of a very large vessel or ship. You've got to be resolute and think it through."
"We are looking at our plans," said Ryan Lance, ConocoPhillips' (COP.N: Quote, Profile, Research, Stock Buzz) president for exploration and production in Europe, Asia, Africa and the Middle East.
"We certainly can't afford what we were thinking we could afford even a month ago going into the next couple of years. So, we absolutely are looking back at our plans," Lance said at a policymakers conference sponsored by the National Council on U.S.-Arab Relations.
Lance said current U.S. crude oil prices of around $60 to $65 a barrel, down from a record $147 in July, "do impact our cash flows."
Jay Pryor, Chevron's (CVX.N: Quote, Profile, Research, Stock Buzz) vice president for corporate business development, said some of his company's projects could be affected by contractors or subcontractors that cannot get the money to buy the necessary materials or provide the services for Chevron projects.
"So there's going to be some delay that is naturally associated with the financial crisis and some of the (oil) demand destruction I think," he said. "We're just starting to see the beginnings of that. So that is a bit concerning."
As a result, Pryor said Chevron might have to rethink some of its projects.
"You might not be able to deliver exactly what you planned to deliver. So, we've got to really analyze that in a lot of detail," he said.
Neither executive would name any specific oil projects that might be put on hold, but they said those projects that were about to get started could be affected. Both emphasized that projects already under way would likely continue because their companies take a long-term view with their business plans.
"You can't as an industry afford to stop investing. If you stop investing, the (oil) supply can drop as much as 10 percent in a year," said Pryor. "The last thing you want to do is jerk the wheel of a very large vessel or ship. You've got to be resolute and think it through."
