Global oil and gas price drops have shattered BP's profits.

The British energy giant said Tuesday that its fourth-quarter "underlying replacement cost profits" (or net income) dropped 91 percent. Profits fell to $196 million, compared with $2.2 billion in the year-ago quarter.

The full-year figures were somewhat less dramatic: 2015 profits amounted to $5.9 billion, down from $12.1 billion the previous year. That's a 51 percent drop.

The company also announced plans to cut up to 3,000 jobs in its product and services arm by the end of 2017, in addition to 4,000 jobs in its exploration and production arm this year.

"We are continuing to move rapidly to adapt and rebalance BP for the changing environment," BP group chief executive Bob Dudley says in a press statement. "We're making good progress in managing and lowering our costs and capital spending, while maintaining safe and reliable operations and continuing disciplined investment into the future of our portfolio."

After the announcement, BP shares were down nearly 9 percent as of midmorning Tuesday.

The sharply lower quarterly profits were "predominantly driven" by the lower global prices of oil and gas, BP says. The price of Brent crude, the global oil benchmark, averaged $44 a barrel in the fourth quarter of 2015, compared with $77 a year earlier, the company says. Today's reported price was $32.42 a barrel.

The Associated Press explains the dramatic drop in crude prices:

"Oil prices have plunged because global supply is high at a time when consumption is growing more slowly than expected. Demand is weakening in China, and investors are jittery because economic turmoil there is expected to slow the growth in demand further.

"OPEC members, meanwhile, are refusing to cut production for fear of losing market share to non-members such as the U.S. and Russia. Iran, which is trying to emerge from decades of sanctions, wants to start pumping more, adding to global supplies."

The news service says some analysts predict crude prices will reach a low of $10 a barrel.

BP operates in nearly 80 countries, has 84,500 employees and produces 3.2 million barrels of oil per day.

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