"Their domestic reserves and production are declining, and they must cut back on capital spending just when they need it most."

It has done so at a cost, however, as international reserves declined by $2.4 billion in 2000 and by $1.6 billion in the first half of 2001.

Its reserves, however, are declining steadily, and the company now has only an eight-and-a-half-year supply of oil left at current depletion rates, according to Mr. Jacoboski.

"This means Texaco's reserves are declining at an alarming rate," Mr. Edgar said.

After adding $240 million to the reserve and loan charge-offs of $270 million net of recoveries, the reserve declined slightly to $2.8 billion.

Many analysts, however, note that reserves are declining for most H.M.O.'s, largely because of greater use of electronic claims processing.

"But now as the economy is slowing, and their expenditures are increasing in so many areas, those reserves are declining, and declining rapidly," Ms. Eckl said.

Private banking sources have said the reserves have declined somewhat from the peak in the oil-boom years, and that they stand now at about $100 billion.

In addition, the Los Angeles-based banking company's reserves for loan losses declined to $76.4 million in the latest quarter from $99.5 million a year before.

The company's reserve for loan losses declined to 83 percent of bad loans in the quarter, from 91 percent in the previous quarter.