By Tom Bergin
LONDON (Reuters UK) - French oil company Total (TOTF) and Norwegian rival Statoil (STL) added to the downbeat tone from the industry, promising to tackle a tough environment with cost cuts as they announced big drops in third-quarter profit.
While both companies benefited from a recovery in crude prices compared with the second quarter, Statoil said the price rise had a weak foundation.
Norway's largest company offered little hope that natural gas prices -- battered by lower demand due to the economic crisis -- would recover any time soon, while Total, Europe's largest refiner by capacity, said crude processing faced a "very difficult" environment.
"Although we see signs of improvement in the global economy, there is no firm evidence that industry investment, employment and private consumption have recovered in a sustainable way," Statoil chief executive Helge Lund said.
"This calls for cautiousness," he said.
Total's adjusted third-quarter net income fell 54 percent to 1.87 billion euros (1.67 billion pounds), in line with a forecast of 1.84 billion according to Thomson Reuters I/B/E/S.
Statoil's adjusted net profit fell 40 percent to 9.3 billion Norwegian crowns (982 million pounds) in July-September, ahead of a forecast of 8.4 billion in a Reuters poll.
Adjusted net income strips out gains or losses from one-off items such as asset sales, and unrealised gains related to changes in the value of fuel inventories. Analysts consider it the best measure of a company's underlying performance.
The results compared with a 47 percent drop in underlying earnings at London-based BP (BP) and a 67 percent drop at Europe's largest oil group by market value, Royal Dutch Shell (RDSa).
Total shares were down 0.5 percent at 40.75 euros at 8:29 a.m., while Statoil shares traded up 1.6 percent at 137.8 crowns, compared to a 0.5 percent rise in the DJ Stoxx European oil and gas sector index . (Additional reporting by Wojciech Moskwa in Osolo; Editing by Dan Lalor)
