(Reuters) - Oil producer Penn West Petroleum Ltd’s PWT.TO second-quarter profit fell and the company cut its capital spending and production forecast for the year as oil prices continue to fall due to excess supply in the United States and global economic uncertainties.
In the April-June quarter, U.S. crude oil prices fell 9 percent from last year to an average of $93 per barrel.
Penn West, which is one of western Canada’s largest conventional oil and gas producers, reduced its capital budget to between C$1.2 billion ($1.21 billion) and C$1.25 billion from a earlier forecast of between C$1.3 billion and C$1.4 billion.
The company also lowered its 2012 production outlook to between 165,000 barrels of oil equivalent per day (boepd) and 168,500 boepd.
Penn West had forecast production of between 168,500 boepd and 172,500 boepd previously.
Net income fell to C$235 million, or 50 Canadian cents per share, from C$271 million, or 58 Canadian cents per share, a year earlier.
The company said infrastructure constraints and transportation bottlenecks further reduced returns.
Production averaged at 163,181 boepd, up 5 percent from a year earlier.
Funds flow fell 31 percent to C$272 million, or 57 Canadian cents per share.
Gross revenue fell 16 percent to C$774 million.
Shares of the Calgary, Alberta-based company closed at C$14.54 on Thursday on the Toronto Stock Exchange. They have dropped 22 percent over the past 12 months. ($1 = 0.9918 Canadian dollars)
Reporting by Krithika Krishnamurthy in Bangalore; Editing by Saumyadeb Chakrabarty