Industry giant Shell suffered a major financial hit after it recorded a $6.1billion loss in its third quarter earnings report.
The figure is a 216% decrease on last year’s $5.3billion gain.
Profit adjusted for one-time items and inventory changes dropped to $1.77billion from $5.85billion a year earlier.
The firm’s upstream business bore the brunt of the financial dip.
Chief executive Ben van Burden said:“Shell’s integrated business and our performance drive are helping to mitigate the impact of low oil prices on the bottom line, in what is a difficult environment for the industry today.
“We continue to improve the operational performance of our assets, and production volumes are up. Costs are falling across the company and Shell’s performance drive is delivering at the bottom line.
Our financial framework is highly competitive, with balance sheet gearing at 12.7%, similar to year ago levels, despite a halving of oil prices. Both net investments and dividends have been covered by operating cash flow over the last year, when oil prices have averaged $60 per barrel.
“While our cash flow and our operating performance in the quarter were strong, the headline numbers we’re reporting today include substantial charges. These charges reflect both a lower oil and gas price outlook and the firm steps we are taking to review and reduce Shell’s longer-term option set.
“We have halted exploration activities offshore Alaska, and stopped the construction of the Carmon Creek in-situ oil project in Canada.
“These are difficult, but impactful decisions. I am determined that Shell will become a more focused and competitive company as a result.”
The company leader confirmed its takeover of BG was still on track for 2016 target date. He said the deal would act as a “springboard to focus Shell into fewer and more profitable themes, especially deep water and integrated gas.”