Exxon Mobil has lowered its oil price outlook to 2027, according to internal company documents reviewed by The Wall Street Journal.

As part of an internal financial programming operation this fall, Exxon lowered its oil price forecast for each of the next seven years, according to the documents. These reductions range from 11% to 17%.

This significant decrease suggests that the Texas oil giant predicts that the fallout from the coronavirus pandemic will be felt for much of the next decade. The fossil fuel industry is also facing increased competition from renewable energy, the growing emergence of electric vehicles, and the prospect of rising global regulations related to climate change.

Unlike some of its competitors, Exxon does not publish its internal opinions on commodity prices, which it considers confidential. Some investors are pressuring Exxon to do so, arguing that these forecasts are essential to properly understand a company's plans and the future value of its assets.

In 2019, Exxon predicted in its internal documents that the price of Brent, the benchmark global price, would average around $62 per barrel over the next five years, before rising to $72 in 2026 and 2027.

This summer, the company revised its forecast downwards. It has set the price of a barrel between $50 and $55 over the next five years, and has reduced it to $60 for 2026 and 2027, according to its documents dated September.

Brent is currently trading at around $47 a barrel after this week's rally, which brought prices back to their highest since the spring.

Exxon's new price forecast came at a preliminary stage in modeling its financial plan, on which the company's board of directors was expected to vote this month, according to one of its executives. An Exxon spokesman declined to say what the company's current price forecasts are, explaining that the company uses a range of prices to develop its business plans.

Oil prices, which have been lower in recent years, threaten to increase financial pressure on Exxon, which has posted three consecutive quarterly losses this year for the first time in its history. Prior to the pandemic, the company was in the process of executing its plan to spend $230 billion to extract an additional one million barrels of oil and natural gas per day in 2025.

Although Exxon is not disclosing its forecasts, it has made optimistic public statements about the long-term future of the oil industry in the aftermath of the pandemic.

In October, the company told investors that with the current underinvestment in the oil and gas production sector, the world would run out of fossil fuels relative to its needs in the coming years. In a post on Exxon's website in October, CEO Darren Woods called the industry's woes temporary and said the use of Exxon's products would increase in the near future.

"Even taking into account the impact on short-term demand of Covid-19, the investment strategy remains relevant," Woods wrote.

Stephen Littleton, Exxon's head of investor relations, said the company is determining the level of its capital investments over a decades-long horizon and that the coronavirus has not changed its long-term view. Exxon has not cancelled any projects due to the pandemic, but has only delayed some, he said.

"The fundamentals have not changed. The only thing that has changed is the timing, because we're sure that demographics and wealth will increase," Littleton said in an interview.

With current oil prices, Exxon is struggling to cover its dividends, which amount to $15 billion a year. In 2020, the company went into debt to achieve this. So far, it has continued to pay its dividends, unlike its competitors. Shell and BP, in particular, have reduced them this year in a context of drying up their liquidity.

After the pandemic began, the company cut $10 billion in capital investment spending and said it could lay off up to 15 percent of its workforce globally. This would concern about 14,000 posts, some of which are held by self-employed persons. Exxon also said it would cut its capital budget by between $16 billion and $19 billion next year.

In 2021, even taking these cuts into account, Exxon would need a price per barrel of between $55 and $65 to be able to cover its capital expenditures and dividend, according to various analysts.

Shell officially revised down its price forecast in June. The tanker now estimates that the barrel of Brent could reach $ 50 in 2022, before stabilizing at $ 60 in the long term. As a result, it announced that it would reduce the value of some of its oil and gas assets by $22 billion. BP also lowered its price forecast and depreciated its assets by billions.

In October, Exxon said it could reduce the value of its natural gas assets, valued at $30 billion, while saying the depreciation did not indicate a change in its long-term price vision. In recent decades, the company has rarely reduced the value of its assets. For years, executives have claimed that the company is extremely cautious in its investment decisions and selects financially profitable projects in any commodity pricing environment.

But Exxon's position as a low-cost operator has crumbled in recent years. Biraj Borkhataria, an analyst at RBC Capital Markets, believes his break-even point is worse than that of any of his peers. It also believes that given its current spending levels, its oil and gas production is poised to decline.

In March, Woods told investors that Exxon had done a stress test based on many potential commodity prices. Some scenarios were based on cheap prices. If the barrel of oil were to stabilize around $50 for years, a hypothesis that Woods said at the time was unlikely, Exxon's debt levels would remain manageable.

"If we stayed in this unprecedented environment for five years, we would change our plans," Woods said.

As part of an internal financial programming operation this fall, Exxon lowered its oil price forecast for each of the next seven years.