(Reuters) – Permian-focused shale producers Diamondback Energy Inc, Cimarex Energy Co and Occidental Petroleum Corp on Monday said their first-quarter oil output will be hit by a recent winter storm that knocked out power to millions in Texas.
While natural gas producers have benefited from a deep freeze forcing closure of wells, shale oil drillers stand on the losing side of the trade as frozen pipes and power supply interruptions are expected to slow an output recovery.
Diamondback said the winter storm will remove about four to five days worth of total production from its current-quarter earnings, sending its shares down 5.4% after the bell.
Occidental forecast first-quarter Permian production of 450,000 to 460,000 barrels of oil equivalent per day (boepd), including a 25,000 boepd hit from downtime related to the storm.
Meanwhile, smaller rival Cimarex said it expects an up to 7% hit to production volume in the first quarter.
Diamondback’s fourth-quarter adjusted earnings of 82 cents per share beat analysts’ average estimates by a cent, according to Refinitiv IBES data, as commodity prices rebounded above pre-pandemic levels on vaccine hopes.
(Reporting by Shariq Khan in Bengaluru; Editing by Maju Samuel)
