Oil Companies Go Slow On Exploration, Output Despite Spike In Crude; Case Of "Capital Discipline'; Industry is twice shy after being burned in previous price booms turned bust.(A)

Byline: MIKE ANGELL

Thanks to strong prices, oil companies are boosting spending on exploration and production. But not by a lot -- and those increases may not bring more oil to market.

Since approaching $50 a barrel on Aug. 20, near-term oil futures have reversed. On Monday, October crude fell 90 cents to $42.28 a barrel, a four-week low.

But long-term futures still point to sustained high prices.

Nonetheless, planned E&P spending hikes are much tamer than in years past. Burned by other price spikes, oil companies are more conservative. Yet with oil output nearing capacity, E&P budgets could keep trending upward for several years.

"Oil companies have gotten the message from institutional investors that they need to be more capital …