Netherlands based Royal Dutch Shell will be reducing its employee count by 6,500 this year, and speed up its spending cuts to cope with the falling oil prices.
The extended period of reduced oil prices has pushed down the energy group’s profit in the second quarter by 37%.
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Shell, which is presently awaiting regulatory approvals for the $70bn acquisition of BG group, also intends to increase its asset disposals to $50bn between 2014 and 2018.
Shell chief executive officer Ben van Beurden said: "We have to be resilient in a world where oil prices remain low for some time, whilst keeping an eye on recovery."
Besides cutting down on staff numbers, the firm is also likely to reduce its direct contractors worldwide in the year.
With dwindling oil prices affecting its profits, the job cuts are in line with the firm’s strategy to reduce $4bn in operating costs.
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By GlobalDataOil prices have dipped by almost 50% within a year to around $55 per barrel.
Beurden added: "Today’s oil price downturn could last for several years, and Shell’s planning assumptions reflect today’s market realities.
"The company has to be resilient in today’s oil price environment, even though we see the potential for a return to a $70-$90 oil price band in the medium term."
Shell intends to divest 20% to 30% of its assets, worth $30bn, out of its downstream and midstream businesses from 2016 to 2018.
The assets sale is expected to allow the firm to focus on larger and competitive assets.
Image: Royal Dutch Shell head office, Carel van Bylandtlaan, Hague, Netherlands, Photo: courtesy of P.L. van Till / Wikipedia.
