OREANDA-NEWS. February 09, 2015. Norwegian oil giant Statoil cut back on planned investments as annual profits were slashed in half in the wake of tumbling oil prices and heavy write-downs.

The company reported annual profits of 21.9 billion kroner (\\$2.9 billion, 2.5 billion euros) for 2014 compared to 39.9 billion kroner the year before and announced a 10 percent cut in its \\$20 billion-investment budget for this year.

"Statoil's quarterly earnings were affected by the sharp drop in oil prices," the group's new chief executive Eldar Saetre said in a statement.

Hit by oil prices which fell by about a half since the summer and heavy write-downs of assets, Statoil went into the red in the second half of the year and recorded a net loss of 8.9 billion kroner in the last quarter.

Adjusted earnings -- without exceptional items -- stood at 136.1 billion kroner compared to 163.1 billion in 2013 and turnover was down 1.6 percent to 606.8 billion kroner.

The group -- 67 percent-owned by the Norwegian state -- said it was stepping up an efficiency program to generate savings of \\$1.7 billion per year from 2016 and that an 8 percent cut in the workforce last year could be followed by further staff reductions.

Despite a rebound towards the end of the year, the company's oil and natural gas production fell by one percent to 1.93 million barrels equivalent per day in 2014.