THE ANNUAL shareholder meetings of ExxonMobil, Chevron and BP, all held on May 27th, each resembled a yearly check-up in a burning clinic. Covid-19 has caused the deepest collapse of demand for the oil giants’ products in history. In April Royal Dutch Shell, an Anglo-Dutch firm, cut its dividend for the first time since the second world war. On May 1st ExxonMobil reported its first loss since the mega-merger that formed the group in 1999.
Even before the pandemic investors were searching elsewhere for lower risk and higher returns. Energy was the worst-performing sector in the S&P 500 index in four of the past six years. Yet the supermajors argue that, for all that, their prospects aren’t bad.
They have half a point. Many of them have become more resilient since the last downturn, in 2014, pursuing more profitable projects and cutting costs. The oil price required to cover capital spending and dividends for the seven biggest—ExxonMobil, Shell, Chevron,...
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