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UK-headquartered oil and gas major BP has announced plans to reduce its workforce by 15% by the end of this year, as the recent downturn due to the Covid-19 crisis caused oil prices to slump.
The move will involve axing around 10,000 jobs, a fifth of which will take place in the UK. However, the decision is expected not to impact front line workers.
Reuters quoted BP chief executive Bernard Looney as saying: “We will now begin a process that will see close to 10,000 people leaving BP – most by the end of this year.”
The majority of the job losses will be mostly office-based roles, with senior management to ‘bear the biggest impacts’, said Looney.
The company employs around 70,100 people worldwide. It targets to downsize its group leadership by a third.
According to BBC, BP did not disclose how many jobs will be lost in the UK but it is thought the figure is estimated to be at 2,000.
The news agency quoted Warwick Business School energy expert professor David Elmes as saying: “The job losses at BP are symptomatic of the wider challenges facing the industry. Coronavirus has reduced oil demand and the price per barrel has plummeted, but that has happened in a wider context of short-term and long-term decline.
“All firms in the sector will all be looking at how they can cut costs, shift their activities to the lowest cost field, trim investment, and thinking hard about what dividend they can pay.”
Earlier this month, BP signed an agreement with oil-field software firm Bluware to interpret large seismic data sets using the latter’s deep learning technology.
In April, BP said that it will not make any layoffs for the next three months.
The latest announcement comes after the expiry of a three-month redundancy freeze across the business.