This whole thing was foreseeable and put in motion when the upstream and downstream split into 2 companies. Now there is no safer net. Low oil prices help downstream and high oil prices help upstream. Not saying there would not be layoffs (since companies are always ready to do that for any downturn in the industry) but would not be do drastic. I never thought that move was a mistake. It put both companies at risk during ups and downs of oil pricing.
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Youuuu're very welcome Captain BriteStar. Good luck and best wishes.
Thank youuuuuu, Captain Obvious.
Lots of vilification here for Mr. Lance, but let's remember some history and context --- from FIVE YEARS AGO.
I have no horse in this race, other than being an investor in the energy sector --- and that hurts --- but where were / are our internal "experts" that predict oil price forecast and industry trends ???
Oil Giant ConocoPhillips to Split in Two, CEO to Retire
Associated Press
Thursday, 14 Jul 2011 | 7:38 AM ET
ConocoPhillips, the nation's third-largest oil company, said Thursday that it will split itself into two separate publicly traded companies and its CEO and Chairman Jim Mulva plans to retire once the transaction is complete.
Source: ConocoPhillips
The breakup would create the largest independent refiner in the world, a prominent analyst said.
"We have concluded that two independent companies focused on their respective industries will be better positioned to pursue their individually focused business strategies," Mulva said in a statement.
Conoco said its board has approved separating its refining and marketing and exploration and production businesses by spinning off the refining and marketing segment to shareholders in a tax-free transaction.
Conoco's refineries produced 2.3 billion barrels per day of gasoline, diesel and other petroleum products in the first three months of the year. As a stand-alone business, it will be the largest independent refiner in the world, Oppenheimer & Co. analyst Fadel Gheit said.
"This is so positive for them," Gheit said. "Everyone should stick to one business."
Instead of selling the refining assets, a spin-off creates a new business that will attract a different class of investors that will be better suited for the ups and downs that come with refining crude, Gheit said.
Refineries, which must buy oil to make gasoline, diesel and jet fuel, routinely struggle to pass on high crude costs to consumers. The industry was hammered by thin profit margins following record high oil prices in 2008, and many companies were forced to idle or sell underperforming refineries.
Conoco has said for the past few years that it plans to scale back its refining business, but until now it had balked at a spin off. Gheit said that company officials likely changed their mind after noticing how much a refinery spinoff was benefiting their Houston neighbor, Marathon Oil. Marathon's stock jumped 30 percent after it announced the split in January.
The Conoco split, which is expected to be completed during the first half of next year, will leave Conoco as an exploration and production company.
Mulva, 64, will lead the separation efforts, but plans to retire once the split is complete.
Conoco said its separation plans do not require a shareholder vote. It expects to provide further details on the transaction "as they are determined over the next several months."