Low oil price takes big bite from Chevron, Exxon earnings

The world's biggest oil companies are reporting grim results in the third quarter of 2015, with Chevron Corp seeing profit fall by 64 per cent and Exxon profit down 47 per cent.

Those earnings were reported Friday, a day after Royal Dutch Shell announced a $7.4 billion loss.

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Chevron announced it would cut an additional 6,000 to 7,000 jobs and reduce capital spending by 25 per cent in the coming year.

It expects capital spending of $25 billion to $28 billion in 2016, down 25 per cent from 2015.

Its third-quarter profit came in at $2.04 billion, or $1.09 a share, down from $5.6 billion, or $2.95 a share, a year earlier.

Exxon spending down 22%

Exxon reported profit of $4.2 billion or $1.01 a share, down from $8.1 billion or $1.89 a share a year ago.

It said it had cut capital spending to $7.7 billion in the third quarter, down 22 per cent compared with the previous year.

It also sold off $491 million in assets to improve its bottom line.

Exxon oil and gas production increased by 2.3 per cent, despite the sharp fall in oil and gas prices over the last year.

Chevron said the average price for a barrel of crude oil and natural gas liquids it received in the third quarter was $42, down from $87 a year ago.

Refining still makes money

Large oil producers like Exxon and Chevron are able to remain profitable because of their refining and processing units, including their chemicals units, which are seeing a boost in demand.

Their upstream operations oil and gas exploration and development have seen a steep slide in profitability.

Shell had to take big writedowns this quarter on its Carmen Creek oilsands operation in Alberta and its Arctic exploration plans.

Shell reported $7.9 billion in charges, including $2.6 billion for its decision to abandon Arctic drilling off Alaska and $2 billion related to the decision to cancel the Carmon Creek project.

It swung from $4.5 billion in profit last year to a $7.4 billion loss in the quarter.