By Shadia Nasralla and Ron Bousso LONDON, June 8 (Reuters) – BP will cut about 15% of its workforce in response to the coronavirus crisis and as part of Chief Executive Bernard Looney’s plan to shift the oil and gas major to renewable energy, it said on Monday.
Looney told employees in a global online call that the London-based company will cut 10,000 jobs from the current 70,100.
“We will now begin a process that will see close to 10,000 people leaving BP – most by the end of this year,” Looney said in a statement.
Reuters had earlier reported the planned job cuts, citing three company sources.
BP shares were up 3.3% by 1230 GMT, against a 2.2% gain for the broader European energy sector.
The affected roles will be mostly senior office-based positions and not front-line operational staff, the company said.
About a fifth of the job cuts will take place in Britain, where BP employs 15,000 people, a company spokesman said.
Like all the world’s top energy companies, BP has cut its 2020 spending plans after the coronavirus pandemic brought an unprecedented drop in demand for oil. BP has flagged a 25% cut to $12 billion this year and said it would find $2.5 billion in cost savings by the end of 2021 through the digitalisation and integration of its businesses.
On Monday, however, Looney said the company is likely to need to cut costs even further.
BP is giving no pay rises to senior employees until March 2021 and said it is unlikely to pay any cash bonuses this year.
ENERGY TRANSITION
The job reductions are also part of Looney’s drive to make the 111-year-old oil company more nimble as it prepares for the shift to low-carbon energy, the sources said.
“It was always part of the plan to make BP a leaner, faster-moving and lower-carbon company,” Looney said.
The spokesman said that the coronavirus crisis “amplified and accelerated” BP’s transition plans.
Looney last month announced a large round of senior management appointments, halving the size of BP’s leaderhip team under his plan to reshape the company’s structure.
Shortly after taking office in February, the 49-year-old CEO said that he was creating 11 divisions to “reinvent” BP and dismantle the traditional structure dominated by its oil and gas production business and its refining, marketing and trading division.
Chevron Corp, the second-largest U.S. oil producer, last month said that it will cut between 10% and 15% of its global workforce as part of an ongoing restructuring.
Royal Dutch Shell, meanwhile, has initiated a voluntary redundancy program.
(Reporting by Ron Bousso and Shadia Nasralla Editing by Louise Heavens and David Goodman)
Norway’s world-leading test center, METCentre, has signed contracts with three companies to test innovative floating offshore wind technology, hoping to reduce costs and advance the development in the nascent renewables...
Exxon Mobil Corporation (NYSE: XOM) has securing the largest offshore carbon dioxide (CO2) storage lease in U.S. history. The Texas General Land Office (GLO) awarded ExxonMobil the lease covering approximately...
Norwegian offshore service provider Viking Supply Ships has made a significant move to enhance its fleet’s capabilities in the subsea sector. The company on Monday announced securing a contract for...
October 7, 2024
Total Views: 1608
Why Join the gCaptain Club?
Access exclusive insights, engage in vibrant discussions, and gain perspectives from our CEO.
This website uses cookies to improve your experience while you navigate through the website. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may affect your browsing experience.
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.