Lower prices to hit Big Oil’s 3Q profit

Big Oil’s bottom line is expected to take a pretty big hit in third-quarter earnings reports because of sharply lower natural gas prices in North America and downtime at production and refining facilities due to hurricanes and seasonal maintenance, The Houston Chronicle reports. ConocoPhillips reports its earnings today, followed by next week’s blitz from BP, Exxon, Chevron and Shell. Tudor, Pickering, Holt & Co. analyst Robert Kessler says that among the biggest unknowns is the extent to which shutdowns affected profits at the major oil and gas companies. “Whether it be Alaska or the Gulf of Mexico or the North Sea, all faced some asset downtime, which affected the companies depending on where their assets are,” Kessler says. Falling oil prices hit large crude producers like ConocoPhillips, which also could see cash flow constraints because of slower-than-expected asset sales, says James Sullivan, senior analyst for Alembic Global Advisors. Oil prices remain a key driver of industry profits, and third-quarter net income will depend partly on where a company’s production is located, analysts say. More details are available in the full story here.