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* Seven of 10 majors to have reported Q3 results registeredlosses
* Shell posts $7.4 bln loss after heavy write-offs
* Italian major Eni reports $1 bln loss
* Sector challenged by lower-for-longer oil price outlook
By Ron Bousso and Karolin Schaps
LONDON, Oct 29 (Reuters) - The oil sector is graduallyslipping into the red after years of fat profits as the slump inoil prices and a grim outlook bite deeper.
The world's top oil companies have struggled in recentmonths to cope with the halving of oil prices since June 2014,cutting spending repeatedly, making thousands of job cuts andscrapping projects.
The lower-for-longer outlook for oil prices took itsheaviest toll yet in the third quarter as oil companies onceagain reported a dramatic drop in income, with some falling to aloss, having taken impairment charges of about $25 billion inthe first nine months of the year.
With 10 of the top 20 European and North American oil andgas producers having reported third-quarter results, seven haveposted losses.
These include Royal Dutch Shell, Italy's Eni and in North America Occidental Petroleum Corp,Anadarko Petroleum Corp, Hess Corp, Suncor and ConocoPhillips.
Shell, posted a third-quarter loss of $7.4 billion onThursday, hit by a massive $8.2 billion charge after halting itscontroversial exploration in Alaska's Arctic sea and a costlyoil sands project in Canada.
DOWNWARD REVISION
About half of Shell's charges reflected a downward revisionof the company's long-term oil and gas price outlook, ChiefExecutive Ben van Beurden said.
The company's net profit excluding identified itemscollapsed to $1.8 billion from $5.85 billion a year ago,reflecting the trend among its peers.
Eni, meanwhile, reported a net loss of $1 billion andFrance's Total came in with a sharp year-on-year dropin profit, though its results were stronger thanexpected.
"The sector is rapidly moving into the red," Jefferies oiland gas equities analyst Jason Gammel said.
"It is slowly going to claw its way back into the blackthrough cost-reduction efforts, but that will take time. It willdepend on price movements, but it will take time to get allthese cost savings through the system."
Although European oil companies have reduced breakevenpoints significantly through cost efficiencies and spendingcuts, they will on average require an oil price of around $78 abarrel in 2016 to cover spending and dividend payments,according to Jefferies estimates before the latest results.
Analysts polled by Reuters expect Brent crude toaverage $58.60 a barrel in 2016.
Shell, which Jefferies says has the lowest cashflowbreakeven point at around $66 a barrel, said it would axe anadditional 1,000 jobs after announcing 6,500 job cuts earlierthis year.
MORE DEBT
Companies are also tapping the debt market, benefiting froma relatively low debt ratio that will allow them to coverspending and dividend payments that, except for Eni, haveremained unchanged.
Britain's BP, for example, increased its debt ratioto 20 percent from 15 percent a year ago after agreeing in Julyto pay $20 billion in fines relating to the 2010 Gulf of Mexicooil spill.
The downturn has forced Europe's majors to reduce 2015spending programmes by about 15 percent to near $107 billion andthe cuts are set to become even deeper next year.
On Tuesday Norway's Statoil posted worse thanexpected third-quarter core earnings and said it would continuecutting costs by slashing capital expenditure by a further $1billion to $16.5 billion.
The sharp drop in revenue from oil production, however, hasbeen offset by spectacular gains in refining and tradingsegments as lower prices boosted global fuel demand, though thepositive impact is expected to fade with the seasonal drop indemand over the winter months.
BP, like Total, managed to beat analyst expectations thisweek despite a sharp year-on-year profit fall, citing increasedefficiencies, higher oil production and strong refiningresults.
Shell and Eni shares were down 1.4 percent and 1.8 percentrespectively at 1422 GMT, with Total up by 0.4 percent. TheEuropean oil and gas index was largely flat.
(Additional reporting by Gwladys Fouche in Oslo, Stephen Jewkesin Milan; Editing by David Goodman)
