EOG Resources, a US shale oil producer, beats its quarterly profit forecasts on higher crude prices
U.S. shale producer EOG Resources beat analysts’ estimates for the?second quarter profit on Tuesday. This was helped by an increase in crude prices.
Crude prices rose sharply due to fears that the 'war in Iran', which erupted late February, would disrupt Middle East oil supply through the Strait of Hormuz. Brent averaged $126.41 a barrel compared to $69.82 in January. WTI increased to $109.64 during this period from $65.17.
EOG reported that the average realized price of oil production increased to $98.15 a barrel in?the second-quarter, up from $64.82 a barrel compared to?the first quarter.
U.S. Shale producers and other energy companies that do not have major operations in the Middle East will benefit from higher crude prices, while being shielded from the output?restrictions, shipping hurdles and damage to infrastructure inflicted on?producers? in the region.
The Permian basin is expected to be boosted by new pipeline capacity and rising oil prices.
Ezra Y. Yacob, CEO of the company, said that oil production was established in the United Arab Emirates by the end of the third quarter. Two one-mile lateral 'wells' produced over 25,000 barrels each during their first 30 working days.
EOG produced 548.800?barrels per day, an increase from 504,200 a year earlier. It expects the third quarter volumes to be between 546,000 and 551,000 boed.
The company is expecting a?5% increase in oil production and a 14% total growth this year.
EOG anticipates capital expenditures in the range $6.3 billion - $6.7 billion annually.
According to data compiled and analyzed by LSEG, the Houston-based 'company' posted an adjusted profit of $5.07 per?share for the quarter _ended June 30 compared to analysts’ average estimates of $4.98.
(source: Reuters)
