Shale producers Pioneer Natural, Devon post sharp drop in second-quarter profits

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FILE PHOTO: The sun is seen behind a crude oil pump jack in the Permian Basin in Loving County (Reuters) -Pioneer Natural Resources Co and Devon Energy Corp posted a sharp drop in their second-quarter profits on Tuesday, as the shale producers were hurt by a decline in oil prices from last year's sky-high levels. Profits for oil and gas companies have dropped from last year's bumper levels after crude prices eased from multi-year highs when Russia's invasion of Ukraine upended markets. Shares of Devon fell 2.4% to $52.41 in extended trade. Pioneer posted a 53.5% drop in second-quarter profit, while Devon's income declined 64.3%. The two companies said their average realized price for oil fell 34% for the April-June quarter from last year. However, crude prices have steadied and traded between $70-$80 per barrel during the quarter, levels which remain lucrative for production, pushing both the companies to report higher output for the quarter. Energy prices had sky-rocketed last year when Russia's invasion of Ukraine upended markets. Permian basin-focused Pioneer said its total average daily production rose 10.5% to 710,678 barrels of oil equivalent (boe), while Devon's oil production averaged 323,000 boe in the second quarter, an increase of 8% from the year-ago period. The rise in production helped Pioneer beat Wall Street estimate. Its adjusted income of $4.49 per share for the three months ended June 30 beat analysts' average estimate of $4.18 per share, according to Refinitiv data. Pioneer also raised the midpoint of its annual oil and total production forecasts to 369,000 bopd and 707,000 bopd. Its shares were up 0.9% at $226.75. (Reporting by Arunima Kumar in Bengaluru; Editing by Maju Samuel)