Exxon Mobil Corp. pledged to safeguard its mammoth dividend after posting its first annual loss in at least 40 years, a show of defiance by an oil driller besieged by activist investors, lawmakers and climate-change campaigners.

Exxon assured investors of its financial health in a world of $50-a-barrel oil and promised that if crude were to dip to $45 it would sacrifice spending in the name of dividends. The Western world’s largest oil explorer has so far avoided the sort of payout cuts adopted by rivals Royal Dutch Shell Plc and BP Plc.

The dividend pledge comes on the heels of a $19.3-billion writedown of U.S. natural gas and other assets, and the lowest production since the 1999 Mobil Corp. merger. Cash flow from operations -- a key gauge of corporate strength -- shrank by almost 9% during the final three months of 2020 to $4 billion.

Investors looked past all that and boosted the stock by 2% to $45.82 at 9:33 a.m. in New York. Exxon’s $15 billion-a-year payout has a 7.56% yield and is third-highest in the S&P 500 Index.

“The focus will remain on cash-flow generation and while it wasn’t great in the quarter, Exxon did provide guidance on covering the dividend with oil at $50 a barrel,” Giacomo Romeo, a London-based analyst at Jefferies International Ltd., said in a telephone interview.

Excluding the historic impairment, Exxon returned to profit in the fourth quarter, earning 3 cents per share, and ending a run of three consecutive quarterly losses. That compares with the Bloomberg Consensus estimate for a 2-cent profit.

Exxon is emerging from the wreckage of 2020 facing the worst crisis in its modern history. In addition to growing criticism of its environmental record, financial performance has deteriorated. Exxon hasn’t increased payouts since early 2019.

“We remain focused on increasing long-term value for our shareholders,” Chief Executive Officer Darren Woods said in a statement. “The past year presented the most challenging market conditions ExxonMobil has ever experienced.”

Such was the pressure exerted by last year’s price collapse that Woods held preliminary talks with his counterpart at Chevron Corp. about a megamerger, the Wall Street Journal reported Sunday.

Before Tuesday’s reassurances, some investors had been worrying the oil titan might resort to a cut to shore up its cash position. As recently as October, the company was still pledging to increase payouts, but that changed a month later when management dropped the word “growing” from its discussion of dividends.

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