Shale producer APA misses fourth-quarter profit estimates on weak prices

Adds shares in paragraph 2 and outlook in paragraphs 6 to 9

Feb 26 (Reuters) - U.S. shale producer APA Corp APA.O fell short of Wall Street expectations for fourth-quarter profit on Wednesday as weak commodity prices offset a rise in production.

The company's shares fell 1.2% to $21.74 after the bell.

Brent crude futures LCoc1 fell 3% in 2024 as major consumer China's economy remained weak and the OPEC+ producer group postponed planned supply increases and extended deep output cuts to the end of 2026 in a sign of weak demand.

In the fourth quarter, APA produced 488,000 barrels of oil equivalent per day (boepd), higher than the 414,000 boepd a year earlier.

The company said that on an average it realized $72.42 for every barrel of oil produced, compared with $81.36 per barrel a year earlier. Meanwhile, average realized prices for natural gas, fell over 24% to $2.20 per thousand cubic feet in the quarter.

Houston-based APA said it expects current-year adjusted production to come in at 396,000 boepd, with output in the Permian basin expected to rise slightly from a year earlier.

The company, which curtailed production in all quarters of fiscal 2024, said current-year U.S. gas production volumes would benefit from no "price-related curtailments".

In January, APA said it curtailed about 23,500 boepd of production in the fourth quarter. In the preceding three quarters, it curtailed production due to persistent weakness in natgas prices in the Permian basin.

The company said on Wednesday it would undertake significant cost reduction initiatives aimed at streamlining the business. It is targeting at least $350 million in annual savings by the end of 2027.

APA posted an adjusted profit of 79 cents per share for the three months ended December 31, compared with the average analyst estimate of 97 cents, according to data compiled by LSEG.