Exploration and production operations for Chevron were "particularly hard hit" as it posted a massive year-on-year drop in reported earnings, its CEO said.

Chevron reported second quarter earnings of $571 million, compared with $5.7 billion for second quarter 2014.

"Second quarter financial results were weak, reflecting a crude price decline of nearly 50 percent from a year ago," Chief Executive Officer John Watson said in a statement. "Our Upstream businesses were particularly hard hit."

Before releasing second quarter results, the company announced Wednesday it was laying off roughly 2 percent of its global workforce, with most of the cuts coming from its offices in Texas and California, where the company is based.

Chevron spokesperson Melissa Ritchie said the layoffs were part of an effort to cut costs by $1 billion in the current market downturn.

A surplus in supplies in a global economy still working to recover from the last fiscal crises has pushed crude oil prices down from above $100 per barrel in June 2014 to around $53 per barrel in Friday trading for the futures contract for Brent.

When releasing its second quarter earnings report earlier this week, Royal Dutch Shell said it expected the market downturn would be prolonged.

Energy companies are spending less on exploration and production as lower oil prices starve them of capital to invest. Chevron said spending on upstream operations, or the exploration and production side of the energy sector, represented 93 percent of total expenditures.

U.S. upstream operations took a loss of $1.04 billion, compared to earnings of $1.05 billion year-on-year. International upstream operations lost $1.18 billion, compared to second quarter 2014 earnings of $4.21 billion.

"Multiple efforts to improve future earnings and cash flows are underway," Watson said.

Shares in Chevron were down 2 percent in pre-market trading Friday on the news.