Rough earnings reports loom for Big Oil companies

This week brings the heart of Big Oil's earnings season and it's not going to be a pretty picture for the industry.

Why it matters: The second-quarter results will bear the heavy imprint of the collapse in demand and prices in recent months — and could reveal more about steps that companies are taking in response.

What's next: European giants Shell and Total report Thursday, while U.S.-based majors ExxonMobil and Chevron report Friday.

What they're saying: "Our team has [forecast] earnings for 72 quarters and 2Q20 seems the most difficult of them," Jefferies analyst Jason Gammel said in a recent note, per S&P Global Platts.

The big picture: "The problem is that there is almost nowhere to hide," Nick Cunningham writes at Oilprice.com.

• Typically low crude prices are offset by majors' refining assets aided by cheaper inputs and heavier demand when fuel costs are low, he points out.
• But lockdowns crushed demand, and "as a result, refining margins collapsed," Cunningham writes. Petrochemical and gas markets were battered too.

Catch up fast: Results from big oilfield services companies last week already show the pandemic's toll.

• On Friday Schlumberger posted a $3.4 billion loss and said it's cutting 21,000 jobs. The Houston Chronicle has more.