ExxonMobil to cut 14,000 jobs as COVID-19 pandemic hits oil demand

ExxonMobil to cut 14,000 jobs as COVID-19 pandemic hits oil demand

FILE PHOTO: Logo of ExxonMobil Corp is seen at the Rio Oil and Gas Expo and Conference in Rio de J
FILE PHOTO: A logo of ExxonMobil Corp is seen at the Rio Oil and Gas Expo and Conference in Rio de Janeiro, Brazil September 24, 2018. REUTERS/Sergio Moraes/File Photo

NEW YORK: ExxonMobil said on Thursday (Oct 29) it could cut its global workforce by about 15 per cent, including deep white-collar staff reductions in the United States, as the COVID-19 pandemic batters energy demand and prices.

ExxonMobil and other oil producers have been slashing costs due to a collapse in oil demand and ill-timed bets on new projects. The top US oil company earlier outlined more than US$10 billion in budget cuts this year.

"The impact of COVID-19 on the demand for ExxonMobil's products has increased the urgency of the ongoing efficiency work," the company said in a statement.

READ: ExxonMobil's fading star: No longer the biggest US energy company

An estimated 14,000 employees globally, or 15 per cent, could lose jobs, including contractors, spokesman Casey Norton said.

The figure will include loses from restructurings, retirements and performance-based exits. ExxonMobil had about 88,300 workers, including 13,300 contractors, at the end of last year.

The company is not targeting a fixed number of jobs but does expect the result of its ongoing business review to eliminate about 15 per cent of its current staffing.

Responding to queries from CNA about potential job cuts in Singapore, a spokesperson for ExxonMobil Singapore said that reviews will be done on a country by country basis.

"The company is undertaking a country by country review. It would be premature to draw any conclusions about Singapore until the review is complete," an ExxonMobil Singapore spokesman said.

ExxonMobil, which has struggled in recent years to regain footing after misplaced bets on shale gas and Russia exploration, lost nearly US$1.7 billion in the first six months of the year. It is expected to report a record-setting third straight quarterly loss on Friday, and its third-quarter loss could reach US$1.19 billion, according to Refinitiv IBES.

ExxonMobil said the 1,900 US job cuts will come mainly from its Houston-area campus, the headquarters for its US oil and gas businesses.

Earlier this month, ExxonMobil said it would cut 1,600 jobs in Europe. It has announced cuts in Australia.

Prior to the pandemic, chief executive Darren Woods pursued an ambitious spending plan to boost oil output in the belief a growing global middle class would demand more of its products.

Royal Dutch Shell and BP also have outlined up to 15 per cent workforce cuts.

Chevron’s planned cuts of 10 to 15 per cent would imply a reduction of between 4,500 and 6,750 jobs. It will also cut roughly another 570 positions as part of its acquisition of Noble Energy. 

BOOKMARK THIS: Our comprehensive coverage of the coronavirus outbreak and its developments

Download our app or subscribe to our Telegram channel for the latest updates on the coronavirus outbreak: https://cna.asia/telegram

Source: Reuters

Bookmark