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Impairments and Other Charges | 9 Months Ended
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Sep. 30, 2020
Impairments and Other Charges [Abstract] |
Impairments and Other Charges | Impairments and Other Charges The oil and gas industry has experienced unprecedented disruption during 2020 as a result of a combination of factors, including the substantial decline in global demand for oil caused by the COVID-19 pandemic and subsequent mitigation efforts. This disruption created a substantial surplus of oil and a decline in oil prices. West Texas Intermediate (WTI) oil spot prices decreased during the first quarter of 2020 from a high of $63 per barrel in early January of 2020 to approximately $21 per barrel by the end of the first quarter of 2020. Although oil prices have recovered modestly, WTI oil spot prices averaged approximately $41 per barrel during the third quarter of 2020, which is approximately 28% less than the average price per barrel during 2019. As a result, oil and gas activity has declined significantly during 2020, with the global rig count sinking to the lowest level since 1973. The U.S. average rig count continued to decline in the third quarter of 2020, dropping 35% compared to the second quarter of 2020, while the international rig count dropped 12% over the same period. In the first and second quarters of 2020, we determined these events constituted a triggering event that required us to review the recoverability of our long-lived assets and perform an interim goodwill impairment assessment as of March 31, 2020 and May 1, 2020. Our review resulted in the recording of impairments and other charges in the first half of 2020. As a result of our goodwill impairment assessments, we determined that the fair value of each reporting unit exceeded its net book value and, therefore, no goodwill impairments were deemed necessary. The factors described above continued to impact our business in the third quarter of 2020 and affected our overall outlook globally. As a result, we recognized additional severance and other charges during the three months ended September 30, 2020, to further adjust our cost structure to reflect current market conditions; however, we determined there were no events that would indicate the carrying amount of long-lived assets may not be recoverable. The following table presents various pre-tax charges we recorded during the three months ended September 30, 2020 and nine months ended September 30, 2020 and 2019, which are reflected within "Impairments and other charges" on our condensed consolidated statements of operations. There were no impairments and other charges recorded during the three months ended September 30, 2019.
| Three Months Ended September 30 |  | Nine Months Ended September 30 |
Millions of dollars | 2020 |  | 2020 | 2019
Severance costs | $ | 83 |  |  | $ | 356 |  | $ | 77 |
Long-lived asset impairments | 31 |  |  | 2,299 |  | 150 |
Inventory costs and write-downs | 11 |  |  | 505 |  | 33 |
Other | 8 |  |  | 193 |  | 48 |
Total impairments and other charges | $ | 133 |  |  | $ | 3,353 |  | $ | 308 |
Of the $133 million of severance and other charges recorded during the three months ended September 30, 2020, approximately $90 million was attributable to our Completion and Production segment and approximately $40 million was attributable to our Drilling and Evaluation segment. Given the dynamic nature of the COVID-19 pandemic and related market conditions, we cannot reasonably estimate the period that these events will persist or the full extent of the impact they will have on our business. If market conditions continue to deteriorate, including crude oil prices further declining or remaining at low levels for a sustained period, we may record further asset impairments, which may include an impairment of the carrying value of our goodwill.

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- Definition Impairments and Other Charges [Abstract] + References No definition available. + Details
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- Definition The entire disclosure of costs incurred for restructuring including, but not limited to, exit and disposal activities, remediation, implementation, integration, asset impairment, and charges against earnings from the write-down of assets. + References No definition available. + Details
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