Exxon Mobil (xom) on Tuesday reported a 58% drop in quarterly profit and said it would cut spending this year by one-quarter as the world’s largest publicly traded oil company copes with a prolonged downturn in crude prices.
Crude oil prices have dropped about 70% from the 2014 high over $100 barrel. Current prices at around $30 barrel have triggered a wave of spending cuts as oil companies slash investment in new wells and projects to conserve cash.
Exxon sees capital spending at around $23.2 billion this year, a decrease of 25% from 2015.
“While our financial results reflect the challenging environment, we remain focused on the business fundamentals, including project execution and effective cost management,” Rex Tillerson, the chairman and CEO, said in a statement.
The Irving, Texas company reported that fourth-quarter profit slid to $2.78 billion, or 67 cents per share, from $6.57 billion, or $1.56 per share, in the same period a year earlier.
Analysts, on average, expected Exxon to earn 63 cents per share, according to Thomson Reuters I/B/E/S.
Exxon said its oil and gas output rose 4.8% in the fourth quarter as it pumped more crude oil.