BASF announced a €600m charge for the fourth quarter citing low oil prices and warned of lower-than-expected 2015 earnings, sending its shares lower today.
Low oil prices, normally a boon to chemical companies, hurt BASF's oil and gas business Wintershall, which accounted for 20% of its 2014 sales.
A global oil glut has pushed prices to 12-year lows and forced energy companies to rein in spending.
The world's largest chemicals company by sales, BASF joins others such as Shell and Austria's OMV in announcing a writedown.
BASF, whose products also include coatings, foam chemicals, catalytic converters and mining chemicals, forecast an 18% drop in 2015 earnings before interest and tax (EBIT) would come to €6.2 billion.
Last October it had warned of a slight decrease and said at the time that weak demand and plunging currencies in markets such as China and Brazil were hurting business.
BASF said it expected oil and gas prices to remain at low levels in 2016 and it had cut its assumptions for subsequent years, forcing it to take the impairment in the fourth quarter of 2015 in its oil and gas division.
Credit rating agency Moody's last week slashed its forecast for 2016 average Brent prices to $33 per barrel from $43 and placed more than 100 energy-related companies on review for downgrade.
BASF said its 2015 sales fell by 5% to €70.4 billion and EBIT before special items was down 8% at €6.7 billion - in line with its guidance.