Chevron slips to red over impairment charges

  • Business & Finance

American energy company Chevron on Friday reported a loss of $1.5 billion for the second quarter 2016, compared with earnings of $571 million in the year-ago period. 

Chevron said that included in the quarter were impairments and other non-cash charges totaling $2.8 billion, partially offset by gains on asset sales of $420 million.

Foreign currency effects increased earnings in the 2016 second quarter by $279 million, compared with a decrease of $251 million a year earlier.

Chevron’s sales and other operating revenues in second quarter 2016 were $28 billion, compared to $37 billion in the year-ago period.

“The second quarter results reflected lower oil prices and our ongoing adjustment to a lower oil price world,” said Chairman and CEO John Watson.

“In our upstream business, we recorded impairment and other charges on certain assets where revenue from expected oil and gas production is expected to be insufficient to recover costs.”

The company posted a drop in 2Q 2016 revenues that amounted to $29.3 billion compared to $40.36 billion in the prior year quarter.

Worldwide net oil-equivalent production was 2.53 million barrels per day in second quarter 2016, compared with 2.60 million barrels per day from a year ago.

When it comes to prices, the average sales price for crude oil and natural gas liquids in second quarter 2016 was $40 per barrel, down from $56 a year earlier, and the average price of natural gas was $3.93 per thousand cubic feet in the quarter, compared with $4.48 in last year’s second quarter.

Offshore Energy Today Staff

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