BP to cut 4000 jobs amid oil price plunge

Royal Dutch Shell Plc, Europe’s biggest oil company, planned to fire more than 6,500 employees past year and lose another 2,800 jobs after it buys BG Group Plc.

The cuts come as the price of brent crude reaches 12-year lows amid concerns that a slowdown in China’s economy will contributed further to the growing glut in oil supplies.

The firm said it has taken the decision in light of “toughening conditions” in the industry.

Oil giant BP is cutting 4,000 jobs in response to plummeting oil prices.

Adding “We are speaking to our staff and agency contractor management and will work with those affected over the coming months”. The company disclosed that the major job cuts would be done in the current year, while the remainder of the plan will be executed by the end of calendar year 2017 (CY17).

During Tuesday’s meeting BP stated that the company has to continue to drastically adapt to the dramatic collapse of the global oil price- now standing at 70% of its peak just over a 12 months ago.

But BP also said that it remained fully committed to the North Sea, pointing out that it will make capital investments worth $2 billion in the region. “Globally, we expect the headcount in upstream to be below 20,000 by the end of the year”.

During a townhall event at its Aberdeen office in northern Scotland Tuesday, BP said 600 of the cuts would take place at it operations in the North Sea, or the swath of ocean between the United Kingdom and the rest of Western Europe. BP has about 3,000 employees in the North Sea, and 24,000 exploration and production employees world-wide, the spokesman said.

The news comes on the back of 160 North Sea job losses at oil services company Petrofac, announced on Monday.

The company noted that as part of the restructuring, 600 North Sea jobs will be made redundant, citing “well-documented challenges” in the maturing North Sea oil region.

The cuts show how the slump in the oil price – while welcome for consumers because it feeds through to cheaper petrol – can have a damaging impact on United Kingdom jobs. “I want to ensure there is North Sea oil and gas production for the long term”.