The two largest U.S. oil companies reported their lowest first-quarter profits in years on Friday as they braced for the economic fallout from President Trump’s trade war, which has weakened consumer confidence and pushed oil prices down.
U.S. crude prices slipped below $60 a barrel this week, a threshold below which many companies cannot make money drilling new wells. Crude oil is now about $20 a barrel cheaper than it was just before Mr. Trump took office. Not only is oil fetching less, companies are paying more for steel and other materials because of tariffs the president has imposed.
There are signs that some companies are already pulling back as a result.
As of last week, the number of rigs drilling wells in the Permian Basin, the largest U.S. oil field, had fallen 3 percent in a month, according to Baker Hughes, an oil field service provider. That company’s customers have been putting off discretionary expenses, and spending across the industry is likely to fall this year, Baker Hughes executives said last week.
Chevron, the second-largest U.S. oil company, said months ago that it would spend less in 2025, and it has not changed its annual production or capital spending forecasts since. However, the company said that it would pare its spending on share buybacks in the second quarter, compared with the first three months of the year.
“We’re comfortable with where we are right now,” Eimear Bonner, the company’s chief financial officer, said in an interview. “We’ve navigated cycles before. We know what to do.”
The financial results that Chevron and Exxon Mobil, the largest U.S. oil and gas company, reported on Friday reflect the market before Mr. Trump announced his latest round of tariffs. Around the same time, members of the producers cartel known as OPEC Plus surprised the market by saying its members would speed up plans to pump more oil.
Chevron’s first-quarter profit fell more than a third to $3.5 billion, missing analyst expectations, as the company earned less for each barrel of oil it produced. Lower margins in refining also hurt earnings.
Exxon’s profit of $7.7 billion in the first three months of the year also came up shy of analyst forecasts collected by FactSet. Earnings fell around 6 percent from a year earlier.
“In this uncertain market, our shareholders can be confident in knowing that we’re built for this,” Darren Woods, Exxon’s chief executive, said in a statement.
Chevron’s stock price fell more than 2 percent in premarket trading. Exxon’s rose about 1 percent.
The question for many companies is how long oil prices will remain around $60 a barrel or less. If they slip to $50, domestic production could fall roughly 8 percent in a year, according to S&P Global Commodity Insights. The United States is the world’s largest oil producer.
Companies are cutting costs where they can as they wait for greater clarity on U.S. trade policy, said Joseph Esteves, chief executive of Maine Pointe, a consulting firm that specializes in operations and supply chain issues.
“It’s getting to the point of no rock unturned, no couch cushion unexplored,” Mr. Esteves said.
Ms. Bonner said Chevron was experiencing a “limited direct impact” from tariffs. The company has been working to mitigate the effects by buying supplies such as steel locally, she said.
Chevron faces a late-May deadline to wind down activity in Venezuela after Mr. Trump took steps to reverse a Biden-era policy that allowed more oil to be produced in the country. The new rules are already having an effect. The company has been unable to load oil onto ships to be exported because of changes to its license, Ms. Bonner said.
“We’re just continuing to engage with the administration on the topic,” she said.
