It's a bad time to be in the commodities business.
Crude is in a veritable tailspin as an increasingly disjointed OPEC ramps production to three-year highs...
...and the thanks to a worldwide deflationary supply glut, the Bloomberg commodities index is sitting near its lowest levels of the 21st century portending doom and gloom for prices across the entire commodities complex.
For producers, this means three things: layoffs, asset sales, and capex cuts. Earlier this week Anglo American unveiled a shocker of a reorganization that included the elimination of 60% of the workforce and asset sales that amount to nearly two thirds of the company's entire portfolio.
On Thursday, we get the latest round of desperate cost saving measures as oil major ConocoPhillips slashes capex by some 25% and looks to raise $2.3 billion from asset sales.
Here's WSJ with the summary:
ConocoPhillips estimated capital expenditures of $7.7 billion for next year, a 25% decline from the reduced levels the oil major expects to spend for 2015.
During October, Conoco had trimmed its 2015 spending plans again after reporting a wider-than-expected loss for its third quarter. At the time, Conoco projected 2015 capital spending of $10.2 billion, down from its prior guidance of $11 billion. It also lowered its operating cost outlook to $8.2 billion from $8.9 billion.
Chairman and Chief Executive Officer Ryan Lance said in prepared remarks Thursday that the company’s plan for next year highlights actions Conoco accelerated over the past year to position the company for low and volatile prices.
On Wednesday, Chevron Corp. projected capital spending plans for 2016 of $26.6 billion, which the oil giant said is 24% below expected capital and exploratory spending this year.