It is a little over a month since oil and gas companies announced FY19 results and set budgets for 2020. Since then COVID-19 has been declared a global pandemic, OPEC+ failed to agree new output restrictions, and oil prices have fallen by 50%.
Companies are responding fast. A further $34 billion in 2020 capex has been shaved off budgets by the Majors and North American Independents, opex is being trimmed back, and share buybacks suspended. Most companies have signalled that they have the capacity to make deeper cuts if necessary but – importantly – several have explicitly stated that despite the macro-economic challenges they will not be reversing commitments to tackle climate change.