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Exxon sees motor fuel demand recovering by year-end; longer outlook unchanged from SNL Daily Gas Report Exxon sees motor fuel demand recovering by year-end; longer outlook unchangedByline: Meghan Gordon Exxon Mobil Corp. sees global gasoline and diesel demand returning to year-ago levels by the fourth quarter, while jet fuel demand will take much longer to recover, top executives said July 31. The Texas-based oil major posted a $1.1 billion loss in the second quarter, its second-straight and largest-ever quarterly loss, as global oil demand sank 20% year over year. "The demand destruction in the second quarter was unprecedented in the history of modern oil markets," Senior Vice President Neil Chapman said during Exxon's July 31 second-quarter earnings call. "Absolute demand fell to levels we haven't seen in nearly 20 years. We've never seen a decline with this magnitude and pace before." Exxon's global oil and gas production fell to 3.6 million barrels of oil equivalent per day, down 10% from the previous quarter and down 7% year over year. North American production of crude and other liquids fell to 1.1 million barrels per day, down 11% from the first quarter and down 2% year over year. While output from the U.S. Permian Basin rose 9% year over year to 298,000 boe/d in the second quarter, a sharp reduction in capital expenditures is expected to cap the outlook for the rest of the year. Exxon's Permian rig count fell to 30 in the second quarter and will fall further to 10 to 15 by the end of the year, it said. The company's global refining throughput fell to 3.5 million bbl/d, down 14% from the previous quarter and down 11% year over year. U.S. refining throughput fell to 1.4 million bbl/d, down 8% from the first quarter but up steady year over year. Amid concern that the pandemic has hastened a permanent decline in the fossil fuel sector, Chapman said long-term predictions for global energy growth have not changed. Exxon expects energy demand to grow 25% by 2040, and fossil fuels will be needed to meet it. "The population will continue to grow, economies will continue to grow," the executive said. "This relationship between societal progress or human development and energy consumption is absolutely clear. "In our business, which is a depletion business, it's not just a question of the growth in demand. It's the depletion as well. ... There is a need for hydrocarbons to come into the market and for people to invest in hydrocarbons to meet that energy demand." |
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