U.S. oil giants Exxon and Chevron post big losses

The two largest U.S.-based multinational oil-and-gas giants both announced billions of dollars in second-quarter losses Friday in results that show the pandemic's toll on the industry.

Driving the news: ExxonMobil, citing "global oversupply and COVID-related demand impacts," reported a $1.1 billion loss, compared to $3.1 billion in profits the same period last year.

• It's Exxon's second consecutive quarterly loss and deeper than Q1's $610 million hit as the company pointed to lower prices, production and sales.
• But Exxon said that its spending cuts helped cushion the blow. Its capital and exploration spending fell to $5.3 billion in Q2, compared to $8.1 billion in Q2 of 2019.

Meanwhile, Chevron reported a $8.3 billion dollar loss, compared to profits of $4.3 billion in the same period last year.

• The tally includes write-downs associated with downward estimates of future commodity prices. The company is also taking a $2.6 billion impairment on its investments in Venezuela, where sanctions have upended its ability to operate there.
• "Even stripping out the impairments, Chevron’s adjusted loss was $3 billion, more than twice the average analyst estimate in a Bloomberg survey and the deepest since at least 1989," Bloomberg notes.
• Chevron is also reducing spending compared to pre-pandemic plans.

What's next: More headwinds, even though market conditions have improved somewhat.

• "While demand and commodity prices have shown signs of recovery, they are not back to pre-pandemic levels, and financial results may continue to be depressed into the third quarter 2020," Chevron said.
• Both companies' stocks were falling in pre-market trading.