NEW YORK (AP) — As drivers, shippers and airlines enjoy lower fuel prices, the oil industry is responding to much lower profits with sharp cuts in spending and layoffs.
Low oil and gas prices are good for the overall economy because they reduce costs for consumers and business. U.S. economic growth was higher in the second quarter, and economists say that was partly fueled by consumers spending some of their savings on gasoline at stores and restaurants.
But with oil prices down around 50 percent from last year, major oil companies are cutting back, offsetting some of this good news.
Texas-based Exxon Mobil said Friday it cut spending by $1.54 billion in the second quarter, while Chevron announced it is laying off 1,500 workers.