Chevron cuts spending plans due to low oil, gas prices

US energy giant Chevron said Tuesday it was further cutting spending plans to address low oil and natural gas prices that are hammering its profits.

Chevron, the second-largest US oil company, reduced its capital spending targets to a range of $17-22 billion per year in 2017 and 2018. In December, the company had lowered the targets to $20-24 billion for the two years.

For 2016, spending plans were slashed 24 percent to $26.6 billion. US competitor ExxonMobil, the largest energy company in the United States, slashed its 2016 spending budget by 25 percent to $23 billion.

"Industry conditions are tough right now, with low oil and natural gas prices," said John Watson, Chevron's chairman and chief executive, in a statement.

The capital spending budget includes resources for oil and natural gas exploration.

Crude oil prices have fallen about 60 percent since mid-2014, pushing a number of companies in the oil sector, including Chevron, into a loss in the fourth quarter.

To weather the market downturn, Chevron is planning to sell as much as $10 billion in assets by the end of 2017.

The company, which said it wants to maintain and increase its shareholder dividend, intends to sell assets in New Zealand and the Gulf of Mexico, natural gas storage units in Canada and refinery assets in South Africa.

Chevon also confirmed its plan to slash 10 percent of its workforce. After 3,200 jobs were cut in 2015, the company said it would eliminate 4,000 jobs this year.

Shares in Dow member Chevron tumbled 2.4 percent to $88.52 in midday trade.