Big Oil majors have no plans to scale back their budgets despite oil prices softening and more barrels poised to hit the market. That may sound reckless in a bearish environment, but it’s anything but. With demand picking up in Asia and OPEC+ preparing to unwind production cuts faster than expected, Exxon, Chevron, Shell, and TotalEnergies are digging in—ready to pump more, not less.
ExxonMobil reported a decline in net profits for the first quarter to $7.7 billion, down from $8.2 billion a year ago. Chevron’s earnings fell more sharply to $3.8 billion from $5.4 billion, and Shell saw a 28% drop in Q1 profit. TotalEnergies reported a more modest 5% dip. Still, none of these companies flagged any spending cuts or strategic retreats. In fact, they’re doing the opposite: raising production targets and sticking to growth plans.
TotalEnergies saw its oil and gas output rise 4% in Q1, boosted by ramp-ups in Brazil, the U.S., Malaysia, and Argentina. Exxon is targeting a 7% production increase for the year. Chevron is aiming for 9%. Even Shell, while more cautious, continues aggressive buybacks and refuses to blink on capex.
The only supermajor to tweak its plans was BP—and even that move came under pressure from Elliott Management, the activist investor calling for deeper cuts and a clearer strategic direction. BP’s Q1 results showed weaker-than-expected earnings, sagging cash flow, and rising net debt—leaving it as the outlier in an otherwise unflinching group.
And now comes the real test: OPEC+ is reportedly planning to dump as much as 2.2 million barrels per day back into the market by November. According to sources cited by Bloomberg, the Saudis have lost patience with serial quota-busters Iraq and Kazakhstan. But there’s a twist—many of the companies responsible for Kazakhstan’s overproduction are Western majors: Chevron, Exxon, Shell, and TotalEnergies.
That’s right—Big Oil is now part of the cartel’s internal compliance headache.
“The presence of U.S. companies like ExxonMobil and Chevron in Kazakhstan could play a key role in driving the supply growth,” said Rystad Energy analyst Mukesh Sahdev. “This raises questions about the potential for U.S. backing to pressure OPEC+ into adding more barrels to the market.”
Which begs the real question: is this shaping up to be a good old-fashioned supply war?
There are certainly signs. China’s crude imports hit a 20-month high in March, jumping to over 12 million barrels per day. That surge reversed the slump seen in January and February and underscored Beijing’s appetite for bargain barrels. India, too, boosted imports from Russia to a nine-month high. When prices fall, the world’s biggest buyers step in.
That’s precisely what Big Oil is counting on. As prices soften, demand will rebound. And the majors want to be front and center when that happens. That explains why they’re not panicking over Q1 earnings declines. They’re playing the long game.
U.S. shale producers, however, are not nearly as relaxed. At sub-$60 Brent and WTI hovering near $56, the economics for independents are breaking down. Bloomberg reports that EOG Resources has cut $200 million from its 2025 capex and dialed back production growth from 3% to 2%. JPMorgan analysts called EOG “the canary in the coalmine”—a warning that more revisions may follow.
And they likely will. While shale drillers have made impressive gains in efficiency over the last decade, they’re still more exposed to price shocks than the vertically integrated supermajors. Shale needs sustained prices closer to $65–$70 to grow comfortably. Below $60, investment dries up fast.
That opens the door for Big Oil. With a mix of conventional, deepwater, and shale projects—and balance sheets padded by years of capital discipline—they can afford to wait out the noise. In fact, they’re betting the current softness in prices will be short-lived, and that when the rebound comes, they’ll be in position to dominate.
Meanwhile, OPEC+ is also feeling the pressure. The decision to accelerate the rollback of production cuts—cramming three months of increases into one, starting in June—suggests a cartel trying to get ahead of a deteriorating market. Whether this move is a show of strength or a prelude to discord remains to be seen. But it adds even more barrels into a market where Big Oil is already ramping up.
If there is a war brewing, it’s not just OPEC vs. shale anymore—it’s OPEC vs. Big Oil, with shale sidelined and Asian buyers cheering from the stands.
In short, the next few months could set the tone for the next chapter of global oil. Will the majors pull back if Q2 earnings disappoint? Possibly—but not likely. So far, they’ve shown every intention of outlasting the storm. And if that storm happens to knock out weaker rivals in the process, all the better.
By Irina Slav for Oilprice.com
