BASF Annual Earnings Could Lag Amid Low Oil Prices

The German chemical giant said that overall sales, as well as sales and income from operations before special items, were "slightly below the level of the previous year."

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BASF on Wednesday suggested that its 2015 earnings could be lower than projected due to poor performance in its oil and gas segment.

The German chemical giant said that overall sales, as well as sales and income from operations before special items, were "slightly below the level of the previous year."

Low oil prices can benefit chemical manufacturers -- which use oil or natural gas as chemical feedstock -- but BASF subsidiary Wintershall accounts for about one-fifth of its overall sales.

Wintershall, Germany's largest crude oil and natural gas producer, suffered along with other producers as oil prices hovered at their lowest levels in years.

BASF's chemicals segment also saw decreased earnings in the fourth quarter due to lower margins in its petrochemical operations, the company said.

The company reduced its assumptions for future years amid projections that oil prices would remain low in 2016. As a result, the oil and gas segment will write down $653 million for the fourth quarter of 2015.

This week's pessimistic signals followed a previous cut of BASF's 2015 forecast in November. Full results for the fourth quarter and 2015 as a whole will be released on Feb. 26.

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