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EOG Resources, a leading U.S. shale oil producer, outperformed Wall Street’s expectations for third-quarter profit and revised its annual production forecast, capitalizing on strong demand for fuel.
During the quarter, U.S. WTI crude prices surged by an average of 9.4%, primarily due to extended output cuts by OPEC+ members Russia and Saudi Arabia. This favorable price environment encouraged energy producers, including EOG Resources, to increase drilling activities. As a result, EOG Resources’ shares rose by 1% after the earnings announcement.
The company’s production demonstrated robust growth, averaging 998,500 barrels of oil equivalent per day during the quarter, a notable increase from the previous year’s figure of 919,200 boepd. This expansion was attributed in part to a rise in natural gas liquids production.
Despite the presence of fewer drilling rigs, the United States has experienced a steady rise in oil and gas production. The industry has been committed to enhancing efficiency and mitigating the impact of declining oil prices.
EOG Resources reported that its average crude oil prices had declined by nearly 13% to $83.60 per barrel compared to the previous year when prices soared following Russia’s invasion of Ukraine.
Furthermore, EOG Resources has raised its full-year production outlook to a range of 971,900 boepd to 992,100 boepd, surpassing its previous projection of 965,300 boepd to 991,500 boepd.
The company also unveiled plans to increase its cash return commitment, targeting a minimum of 70% of annual free cash flow starting in 2024. Additionally, EOG Resources boosted its quarterly dividend by 10%, reaching 91 cents per share.
On an adjusted basis, EOG Resources, headquartered in Houston, Texas, achieved earnings of $3.44 per share for the quarter ending on September 30, surpassing analysts’ expectations of $3.02 per share, as reported by LSEG data.
EOG Resources’ solid financial results and expanded production outlook reflect its resilience and competitiveness within the energy industry. The company’s strategic approach underscores its commitment to delivering value to shareholders.
