BP to cut 10,000 jobs amid downturn

BP will reduce its headcount by 10,000 globally as it strives to cut costs and debt amid the latest oil demand crisis.

Julia Horowitz reported the news for CNN:

BP (BP) is cutting 10,000 jobs as it reels from a crash in oil prices and tries to pivot toward renewable energy.

CEO Bernard Looney told employees on Monday that the oil giant would reduce its global workforce by nearly 15% this year. Most of the cuts will affect office jobs.

The company said in February that it would reorganize its business to achieve net zero emissions by 2050 or sooner. The coronavirus pandemic, which caused oil prices to plunge as people hunkered down at home, has only accelerated the need to reduce costs, Looney said.

Bloomberg’s Laura Hurst reported:

The coronavirus pandemic has hit companies’ earnings and forced many to change the way they operate. European competitor Royal Dutch Shell Plc is said to be offering voluntary redundancies in a bid to become leaner, and U.S. rivals Chevron Corp. and Marathon Oil Corp. are among others laying off employees.

BP will let go of 14% of its workforce, Chief Executive Officer Bernard Looney said in an internal note. The move will mostly affect staff in office-based jobs and those holding senior roles, with the top 400 positions expected to be cut by one-third.

The BBC quoted Looney as saying:

In an email to staff, he said: “The oil price has plunged well below the level we need to turn a profit.

“We are spending much, much more than we make – I am talking millions of dollars, every day.”

Countries across the globe have ordered people to stay indoors and not travel, which has caused a slump in demand for oil. As a result, the cost of oil fell to less than $20 a barrel at the peak of the crisis, less than a third of the $66 it cost at the start of the year. It has since partly recovered to around $42 a barrel.

That has taken a toll on the industry, sparking warnings that 30,000 UK jobs could be lost as a result of the crisis.