Exxon Mobil closed the books on a terrible 2020 on Tuesday, reporting losses in the fourth quarter and the full year in the wake of lower oil prices amid the COVID-19 crisis. 

Exxon Mobil, which has been criticized over the last year for both its financial performance and its approach to renewable energy investment, suffered a loss of $22.4 billion in 2020 after posting a profit of $14.3 billion in 2019.

That marked the company's first annual loss following the 1999 closure of the Exxon-Mobil merger. 

The global energy giant, which was bumped from the prestigious Dow index last year, unveiled new cost-cutting efforts, a new low-carbon business unit and a new board member, changes which the firm said would position it for the future. 

However, the moves failed to quash criticism from activist investors seeking to remake the company's board, or to convince environmentalists who say the U.S. company is falling behind European rivals in planning for the energy transition. 

"Today's patchwork of announcements do not materially alter Exxon Mobil's long-term trajectory nor do they position it to succeed in a changing world," said the activist group Engine No. 1, which has nominated four directors to the company's board. 

In the fourth quarter, Exxon Mobil suffered a loss of $20.1 billion following huge write-offs. But the results were better than expected when the write-down is discounted. Revenues fell 30.7 percent to $46.5 billion. 

The company, which announced plans last year to cut 15 percent of its global staff, unveiled plans for additional spending cuts of $3 billion in annual expenses expected by 2023. 

Chief Executive Darren Woods said 2020 provided the most challenging market conditions Exxon Mobil has ever experienced, adding that the company responded "decisively" by reorganizing its operations and cutting spending. 

While oil prices have partly recovered from historic lows during the worst of the pandemic shutdowns, U.S. oil prices in the fourth quarter traded in the low $40 per-barrel range, off from the mid-$50s in the year-ago period. 

Exxon Mobil said it built its plan for 2022 to 2025 on oil prices of between $45 and $50 per barrel, but if prices slip below this level, "the company has the ability to further reduce capital investments, cover the dividend and maintain a strong balance sheet."

Woods, on a conference call with analysts, said "we don't know where prices are going to go," adding that the company based its program on a "reasonable" assumption that includes third-party inputs. 

Petroleum demand has been choppy week to week and "things seem to be shifting quarter to quarter on the perceptions and nature of the recovery," said Peter McNally, analyst at Third Bridge Group. 

Exxon Mobil's earnings came just days after The Wall Street Journal reported the company held merger talks with Chevron last year during the height of the pandemic. 

Woods was not asked directly about the report, but said he would "not comment on speculation in the press" in response to a question about industry consolidation. 

Real change?

Amid criticism that it has not invested in renewable energy, Exxon Mobil said its business would focus on carbon capture and storage technology as a means to counter the emissions that cause global warming.  

Exxon Mobil has worked on carbon capture for years, but Woods said the company was optimistic the technology would be embraced, given the shift in the U.S. presidential administration. 

But Andrew Logan, director of the oil and gas program at investor activist group Ceres, said the effort on carbon capture appeared little more than a "repackaging of existing efforts." 

Logan contrasted Exxon Mobil's approach with European giants BP and Royal Dutch Shell, which have invested significant sums in renewable energy and pledged to have net zero emission by 2050. 

"Investors realize that they should be asking for more fundamental change and they've moved to a place where Exxon is just not willing to go," Logan said.  

The oil giant also nominated to its board the former chief executive of Malaysian national oil company Petronas, Tan Sri Wan Zulkiflee Wan Ariffin. 

The move came after Engine No. 1 had blasted Exxon Mobil's board for having no independent directors with outside energy experience. 

But Engine No. 1 said the move was not enough, saying shareholders "deserve a Board that works proactively to create long-term value, not defensively in the face of deteriorating returns and the threat of losing their seats." 

The company's shares ended up at $45.63, rising by 1.6 percent.