ExxonMobil’s third quarter earnings were down $3.8 billion from the year ago quarter.
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But those profits are down sharply from a year earlier.
For Chevron, the average price of a barrel of crude oil and natural gas liquids was more than halved from $87 a year ago to $42 in the third quarter.
Both companies reported profits in 3Q, but their performance was significantly down as compared to past quarter.
Chevron did not detail its job cuts or where they would occur. Spending in 2016 will be 25 percent less than this year, said Chevron Chairman and Chief Executive Officer John Watson in the statement. As of December 2014, Chevron had about 64,700 employees, according to a securities filing.
The mass layoffs at Chevron, amounting to over 10 percent of the firm’s work force, are part of a rash of job cuts in the United States and internationally, showing that the world economy remains mired in slump seven years after the 2008 Wall Street crash.
Exxon doesn’t foresee any charges in the near future related to restructuring, Vice President of Investor Relations Jeff Woodbury said during a conference call with analysts on Friday.
Next year, Chevron, plans to shrink its budget by twenty five percent and spend less in Angola Australia as well as the U.S. Gulf of Mexico, the location where the second largest USA oil company has its key growth projects. Household spending on natural gas, oil, and propane for heating homes this winter will decline by 10 percent to 25 percent depending on the type of fuel, the agency predicts.
Chevron cut operating and administrative expenses by 7 percent during the quarter, but it was not enough to fully offset the price drop.
Many industry experts agree, but the downturn in prices has lasted longer than most had expected.
Want the latest recommendations from Zacks Investment Research? The FactSet analysts had expected $61.71 billion.
In morning trading, shares of San Ramon, California-based Chevron rose 67 cents to $90.56.
The company that makes the blockbuster anti-inflammatory drug Humira also announced a 12 percent dividend increase.
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Earnings plunged year/year to $2.04 billion ($1.09/share) from $5.6 billion ($2.95). However, the market witnessed a few buying interests by investors, and the share price was pushed to hit $0.39, the day high. Thomson Reuters had a consensus analyst price target of around $93.60 before the report. ExxonMobil generated earnings of $4.2 billion in the third quarter. Revenue declined by nearly a third to €18.81 billion. The lower-cost crude has helped its refinery businesses improve profit margins. BP has also reduced its full-year capital expenditure (capex) for the third time this year to close to $19 billion, down from previous plans under $20 billion.
