Another energy company is scaling back because of the oil crash.
Consol Energy announced Friday that it is cutting its capital expenditure forecast for 2015 to $US920 million from the $US1.0 billion it announced January 30.
Here’s an excerpt from their statement:
“The revised budget reflects a continued focus to high-grade the development plan to further reduce capital in a lower commodity price environment, while maintaining the E&P production growth target of 30% in 2015. In addition to reducing capital, CONSOL also continues to make significant progress on driving operating costs lower through cutting costs and implementing efficiency improvements with the goal of keeping its year-end 2015 leverage ratio flat, when compared to 2014.”
Last month, Deutsche Bank forecast that energy companies would slash capex forecasts by 25% this year, and capex growth will decline 3% overall.
Oil prices are not recovering any time soon, according to a report from the International Energy Administration on Friday. West Texas Intermediate oil futures tanked as much as 3.5% to around $US45.36 per barrel in trading.
US oil prices are under pressure as inventories continue to pile up; they are at the highest levels for this time of year in at least 80 years, according to the Energy Information Administration.