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Chevron chairman and CEO John Watson. Image courtesy of f the Government of the Russian Federation/Wikimedia Commons.

Chevron’s second quarter results missed analysts targets on Friday after low oil prices dragged the company’s upstream segment to a $2.2 billion loss.

The company reported earnings of $571 million, or $0.30 per diluted share, for the second quarter 2015, a huge drop from $5.7 billion in earnings booked during the same quarter last year.

According to CNBC, the results mark the company’s worst quarterly profit performance in nearly 13 years.

Analysts had expected earnings to hit $1.13 per share, Zacks said.

The company’s upstream segment sunk to a $2.219 billion loss, down from $5.264 billion in earnings last year.

U.S. upstream operations fell to a $1.04 billion loss in second quarter, down significantly from earnings of $1.05 billion a year earlier.

Chevron said the loss was caused by “sharply lower crude oil realizations and higher depreciation expenses.”

Downstream earnings jumped to $2.956 billion, a huge gain from $721 million in dowstream earnings reported during the second quarter of 2014.

“Second quarter financial results were weak, reflecting a crude price decline of nearly 50 percent from a year ago. Our Upstream businesses were particularly hard hit, as lower prices reduced revenues and triggered impairments and other charges. Downstream operations continued to deliver strong financial performance, reflecting both high reliability and improved margins,” Chevron chairman and CEO John Watson said.

The company’s worldwide net oil equivalent production was 2.60 million barrels per day in second quarter 2015, up from 2.55 million barrels per day in the second quarter 2014.
Chevron took $1.96 billion in impairments and $670 million in other charges related to project suspensions and adverse tax effects, the company said.

The impairment charges were partially offset by $1.8 billion in asset sales.

Sales and other operating revenues in the second quarter fell to $37 billion, down from $56 billion in the year ago period.

Cash flow from operations in the first six months of 2015 slid to $9.5 billion from $16.3 billion in the corresponding 2014 period.

Excluding working capital effects, cash flow from operations in 2015 dropped to $11.6 billion from $17 billion in 2014.
Last week, Chevron announced that it will cut 500 jobs at its headquarters in San Ramon, California as part of a cost cutting plan.
According to the San Jose Mercury News, the California-based company will also cut 950 positions from its Houston office along with 50 international jobs.