Shale producer Diamondback misses profit estimate, cuts capex forecast
Shares of the company fell 2.7% in extended trading on Monday. They are down nearly 11% so far this year, through last close.
Diamondback cut the upper end of its current year capital budget by $200 million to bring it to between $3.4 billion and $3.6 billion, dragged down by prolonged volatility and uncertainty.
The company, which dropped four rigs to 13 rigs in the April-June quarter, said on Monday there was no compelling reason to increase activity this year.
Diamondback in May said that a combination of global economic uncertainty and rising OPEC+ supply has brought U.S. oil production to a tipping point. It had also warned that it could reduce activity further if oil prices declined further.
The Midland, Texas-based company posted an adjusted profit of $2.67 per share for the three months ended June 30, compared with analysts' average estimate of $2.82, according to data compiled by LSEG.
Brent crude averaged 20% lower in the quarter from a year earlier, pressured by U.S. tariffs and their impact on global growth, OPEC+ supply gains and geopolitical tensions.
Prices briefly topped $80 per barrel after Israel targeted Iran's nuclear sites in June, but slid to $67 by the end of the period.
Diamondback said its average realized crude price, excluding hedges, for the quarter stood at $63.23 per barrel, down about 20% from last year.
Production almost doubled at 919,879 barrels of oil equivalent per day (boepd) following its $26 billion acquisition of private rival Endeavor Energy Resources.
The company raised its full-year production forecast to between 890,000 and 910,000 boepd, from between 857,000 and 900,000 boepd, on the back of gas demand.
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