Mar 25, 2020 - Energy & Environment

Equinor is the latest oil giant to cut back amid coronavirus price decline

An oil rig.

Photo: CARINA JOHANSEN/NTB Scanpix/AFP via Getty Images

Equinor is the latest oil-and-gas giant to announce it will cut spending in response to coronavirus and the steep decline in oil prices.

Driving the news: The Norway-based multinational said Wednesday morning that its planned 2020 capital spending will now be around $8.5 billion this year, down from $10 billion to $11 billion.

  • The company's action plan includes cutbacks to exploration and operating costs.

Why it matters: It shows how companies are drastically overhauling their plans to cope with the new market landscape.

  • Equinor said its overall goal is to be cash-flow neutral for 2020 with Brent crude oil prices averaging around $25-per-barrel for the remainder of the year.
  • Brent is trading in the $26-per-barrel range on Wednesday morning.

What's next: U.S. activities are in the crosshairs. "Within U.S. onshore activities, drilling and completion activities are being halted to produce the volumes at a later period, reducing investments significantly for 2020," the company said.

  • Reuters has more on the plans here.

Meanwhile, the Wall Street Journal reviewed an internal email from the huge U.S.-based producer Occidental Petroleum which reveals plans to cut salaries for U.S. employees by up to 30% to save money.

  • "Chief Executive Vicki Hollub’s salary will be cut by 81% and the oil-and-chemical company’s top executives’ pay will be cut by an average of 68%, according to the email."
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