French oil major Total said Thursday it would trim back costs and investment in 2017-2018 in the face of continued low oil and gas prices.
Total said it would cut annual investment to between $15 and $17 billion from next year instead of previous plans for $17-19 billion, and that it now intends to shave $4 billion from operating costs instead of $3 billion by 2018, AFP reported.
"This is a strong commitment on our part. We do not intend to go beyond this range even if there was a sudden upsurge in oil prices," Total CEO Patrick Pouyanne said in a statement.
In February, Total said the global collapse in oil prices, which have fallen by some 70% since 2014 amid massive oversupply, made cost-cutting inevitable.
In 2015, it had ploughed $23 billion into investments before ramping that down this year ahead of Thursday's announcement of further cuts. Pouyanne said earlier this year that the entire industry was facing "quite a crisis" albeit forecasting prices would increase by yearend.
He also announced a hiring freeze at Total, which employs some 96,000 people in 130 countries.
In a statement Thursday, Total said the firm was targeting further capital expenditure discipline and cost deflation but said the group's integrated business model was strong as it manages its operations "to position itself for profitable medium-term growth."
On divestment, Pouyanne said the firm has reached its objectives and does not see the need to do more. He confirmed that Total was looking at selling its Italian petrol station joint venture with Erg, while talks over the sale of its chemicals and equipment division Atotech, were ongoing.
Total's shares were up 3.68% at close on Thursday, outperforming the European oil and gas index which gained 2.35%.
