What happened Shares of ExxonMobil (NYSE: XOM) plunged 40.9% in 2020, according to data provided by S&P Global Market Intelligence. While a roughly 20% decline in oil prices played a role in Exxon's slump, it wasn't the only factor. So what The COVID-19 outbreak upended the oil market in 2020. It caused demand to fall off a cliff, which forced oil companies like Exxon to shift gears. Exxon initially responded by reducing its 2020 capital spending program by 30% and operating expenses by 15%. Image source: Getty Images. While those moves helped reduce the bleeding, the company significantly outspent its cash flow in 2020, partly because it maintained its massive dividend. As a result, its debt ballooned from $47.1 billion in the third quarter of 2019 to $68.8 billion by the third quarter of 2020, putting pressure on its stock price. Meanwhile, persistently low oil prices caused Exxon to lose billions of dollars in 2020. Through the third quarter, the oil giant posted more than $2.3 billion in losses. But that pales compared to what the company anticipates for the fourth quarter, as it warned it would record a massive writedown of up to $20 billion in assets. Exxon also changed its long-term strategy in 2020. It plans to prioritize high-value assets, which will result in it investing only $16 billion to $19 billion in capital projects in 2021 while spending an annual average of $20 billion to $25 billion through 2025. That's a roughly $10 billion yearly reduction from its initial long-term forecast. As a result, it won't grow its production and earnings as much as it initially envisioned. Now what Crashing crude oil prices in 2020 threw a wrench into ExxonMobil's long-term plan. The company had to slash spending so that it didn't pile on too much more debt, but it still significantly outspent cash flow to maintain its dividend. Unless oil prices improve, the company will likely tack on more debt this year, putting its dividend at even more risk of a reduction. Because of that, Exxon's stock might not bounce back in 2021. 10 stocks we like better than ExxonMobilWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and ExxonMobil wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of November 20, 2020 Matthew DiLallo has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.Source