Canada’s largest oil companies continue to post quarterly losses this year as low crude oil prices and low refining margins hit earnings.
On Wednesday Suncor Energy reported its third consecutive quarterly loss so far this year, as the pandemic severely hits both the upstream and downstream sectors in Canada.
Suncor posted a net loss of US$9 million (C$12 million) for Q3, smaller than the losses for the previous two quarters, but a loss nevertheless, especially compared to the net earnings of US$773 million (C$1.035 billion) for the third quarter of 2019.
Earlier this year, Suncor axed its dividend by 55 percent after posting a loss in the first quarter.
Suncor said on Wednesday it was also accelerating previously disclosed structural reductions to its workforce over the next 18 months by approximately 10 to 15 percent to further reduce costs.
On Thursday, Cenovus Energy and Husky Energy - which had just announced their agreement to combine - also reported Q3 financials, and they also reported losses.
Cenovus reported a net loss of US$145 million (C$194 million) for Q3 - its third straight quarterly loss - after an impairment charge of US$337 million (C$450 million) associated with a refinery Cenovus co-owns with the operator, Phillips 66, at Borger, Texas. Related: Oil Plunges To $35 As Lockdowns Return
Husky Energy, for its part, booked a massive net loss of US$5.2 billion (C$7 billion) due to after-tax non-cash impairments of US$5 billion (C$6.7 billion) related to lower long-term commodity price assumptions and reduced capital investment.
“While oil prices showed gradual improvement during the third quarter, we were impacted by lagging U.S. refining margins, turnarounds at several facilities and a significant non-cash impairment related to lower long-term commodity price assumptions and market indicators, including the recently announced transaction,” CEO Rob Peabody said in a statement.
“We are confident that the combination with Cenovus will deliver significant long-term value by creating a larger, stronger and more resilient Canadian integrated energy producer,” Peabody added.
By Michael Kern for Oilprice.com
More Top Reads From Oilprice.com:
- Oil Prices Under Pressure Again As Supply Climbs
- China Sets Its Sights On Global EV Dominance
- The Car Giants That Knew About Climate Change 50 Years Ago