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Two U.S. energy giants report quarterly losses due to low oil prices

Xinhua, February 5, 2016 Adjust font size:

Two Houston-based U.S. energy giants on Thursday reported huge losses in the fourth quarter of last year, blaming the headwinds of a collapse in the oil prices which hover around record lows.

ConocoPhillips, the third biggest U.S. oil company, said in a written statement that it lost 3.5 billion U.S. dollars, or 2.78 dollars a share, in the fourth quarter of last year, down from its net loss of 39 million dollars, or 3 cents a share in the same period the year before. Its revenues fell 42 percent to 6.8 billion U.S. dollars.

The Houston oil producer, whose crude production remains flat for the year, reduced its 2016 capital spending guidance 16 percent to 6.4 billion dollars as it cut down activity in U.S. shale plays. The company will also cut its expectations for operating costs 9 percent to 7 billion dollars.

As for the oil prices, ConocoPhillips Chief Executive Officer (CEO) Ryan Lance said that while they did not know how far commodity prices will fall, or the duration of the downturn, they believed it is prudent to plan for lower prices for a longer period of time.

Meanwhile, Occidental Petroleum Corporation recorded on Thursday a loss of 5.18 billion dollars in the fourth quarter. The oil and gas producer said that it booked a total of 5.4 billion U.S. dollars of after-tax charges, mostly due to cheap oil eroding the value of its assets.

Steven Chazen, CEO of the company, said in a written statement that the company has about 4.4 billion U.S. dollars in total cash on the balance sheet and plans to guard its remaining funds carefully.

The company will continue to focus on capital and operating efficiencies, Steven said, adding that the company's 2015 capital spending was down by 36 percent compared to a year ago, and total company production still increased 14 percent with Permian Resources growing 47 percent.

The plunging oil prices, which started from mid-2014, have had serious impact on Texas, a major oil and gas producer in the U.S. The Lone Star state has so far lost at least 60,000 upstream oil and gas jobs, plus as many as 250,000 supply chain and retail jobs indirectly, as a result of the oil crash. Enditem