Chevron Overtakes Exxon Mobil as America’s Largest Oil Company - Bloomberg

A gas flare at a Chevron Phillips Chemical Co. plant ahead of Hurricane Laura in Port Arthur, Texas, U.S., on Tuesday, Aug. 25, 2020. Hurricane Laura is poised to become a roof-ripping Category 3 storm when it comes ashore along the Texas-Louisiana coast, threatening to inflict as much as $12 billion of damage on the region and potentially shutting 12% of U.S. refining capacity for months.

Photographer: Luke Sharrett/Bloomberg

Chevron Corp. overtook Exxon Mobil Corp. as the largest oil company in America by market value, the first time the Texas-based giant has been dethroned since it began as Standard Oil more than a century ago.

California-based Chevron had a market capitalization of $142 billion at the close of U.S. trading on Wednesday, compared with Exxon’s $141.6 billion.

The entire oil and gas sector is suffering from the plunge in energy prices this year caused by Covid-19. But Chevron has emerged with the strongest balance sheet among its Big Oil peers -- it was able to complete its $5 billion acquisition of Noble Energy Inc. last week. Exxon, by contrast, is struggling to generate enough cash to pay for capital expenditures, leaving it reliant on debt and putting pressure on its $15 billion-a-year dividend.

Chevron had been closing in on its long-time rival for more than a year, even before the pandemic crushed oil demand. Chief Executive Officer Mike Wirth has focused on Chevron’s shale operations, cutting costs and keeping a tight rein on new projects. Exxon pursued a series of expensive projects that promised growth after years of stagnating production, but which became a drag on its cash flow when the pandemic hit.

READ: Exxon’s Humbling Fall From Oil Juggernaut to Mediocre Company

READ: NextEra Now More Valuable Than Exxon as Clean Energy Unseats Oil

The American giants’ biggest European rivals, BP Plc and Royal Dutch Shell Plc, face problems of their own -- their shares slumped after cutting their prized dividends earlier this year. Some analysts believe Exxon may be next in line to cut its payout. The U.S. company will be unable to fund its dividend without drawing down cash or selling assets before 2025, analysts at Goldman Sachs Group Inc. said in a note Tuesday.

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https://www.bloomberg.com/news/articles/2020-10-07/chevron-overtakes-exxon-mobil-as-america-s-largest-oil-company

2020-10-07 20:06:00Z
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