Following an assessment of third quarter results from major oil and gas companies, Wood Mackenzie has outlined weak financial performance in 3Q, surging production levels and deep cost cutting as key trends.
Wood Mackenzie noted that upstream earnings were weak for the fourth quarter in succession and stated that 3Q was a strong quarter for production, as a result of low prices on production sharing contracts and reduced maintenance downtime. Total was the top performer in terms of output, delivering double digit growth. Eni, Statoil and Shell also had strong quarters. Wood Mackenzie stated that spending levels among majors in 2017 could be down by around 30 percent, compared to guidance prior to the oil price crash.
Tom Ellacott, head of corporate upstream analysis at Wood Mackenzie, commented in Wood Mackenzie statement:
"The crash in oil prices this year is having a transformative impact on the industry. The majors are now making real progress in reshaping their investment strategies for a sustained period of low prices."
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