Brent benchmarked crude has fallen from around $65 per barrel down to about $47. Unhealthy Q3 earning results and billions of dollars in asset write downs are indicative of the state of the industry. Belt tightening is the order of the day.
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Analysts on average had expected earnings of $1.29 per share on revenue of $37.89 billion, according to Thomson Reuters I/B/E/S.
Chevron has announced that it will cut as many as 7,000 jobs due to falling oil prices. Profits of the company too tumbled in the third quarter.
The San Ramon, Cal.-based company reported a 63.6 percent fall in earnings to $2.04 billion in the quarter to September 30 compared to a year ago. The firm’s quarterly revenue was down 33.4% on a year-over-year basis.
USA upstream operations posted a loss of $603 million in the third quarter, and for the year to date, US upstream operations have lost $2.1 billion.
Watson said the company has raised $11 billion by selling assets in the last two years, and it could generate another $5 billion to $10 billion in sell-off gains by the end of 2017. Its budget will decline further in 2017 and 2018 to between $20 billion and $24 billion. More than 87,000 people have been fired since prices began to drop earlier this year, and now it’s Chevron’s turn to begin massive layoffs. Earnings per share were $1.09 per share, while analysts surveyed by Bloomberg had forecasted it to be $0.76 a share. Chevron pared back its operating and administrative expenses by 7 percent since a year ago and plans additional reductions in the coming months, the company said in its earnings release.
Earlier this week, Royal Dutch Shell PLC announced a US$8 billion loss, caused in part by lower energy prices.
Revenue surged 18 percent to $5.94 billion, beating analyst expectations.
Nevertheless, Chevron’s production outlook remains one of the most robust in its peer group, with a number of major initiatives scheduled to come online during the next few years.
Chevron Corp. (NYSE: CVX) reported third-quarter 2015 results before markets opened Friday. The proceeds of which will be used for its exploration and production business and to shore up its balance sheet. As an integrated energy firm, Exxon has a hefty dose of refining and downstream muscle. Eni’s top recent discovery has been a massive natural gas field off the Egyptian coast. How well this plays out is nearly entirely contingent on when crude oil prices finally do rebound and whether Chevron can downsize its bloated expenditures in time to stave off a total collapse in the Chevron stock price. It expects to spend $500 million on buybacks in the fourth quarter down from $3 billion in the fourth quarter of 2014.
In the second quarter, for instance, owing to the global oil glut, the Texas-based company posted its lowest quarterly profit since 2009, leading to an earnings miss of around 10%.
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Exxon Mobil is dealing with oil prices that have dropped by half since June 2014 and have remained lower for longer than most industry experts expected.
