BP’s new CEO Bernard Looney stated at Reuters that the company will cut about fifteen percent of it’s workforce. Part of this decision has to do with the drop in demand of oil due to the Covid-19 crisis. But also the shift to renewables forces the company to take measurements.
A dispute between Russia and the US had already put the global oil prices under pressure when Covid-19 rushed in. The surplus of oil and oil products forces oil company’s to cut costs dramatically. BP aims to cut one fourth of it’s costs this year. The decrease in jobs is one of the measurements the company takes to stay in business.
BP has 70,100 employees worldwide and tries to cut 10,000 jobs. Looney stated that most of the lost jobs will be at office-based positions. Operational staff is still needed: especially now the company prepares to shift to low-carbon energy.
BP also has refineries in Rotterdam and the Belgian town of Geel. It is still unknown where the redundancies will occur, but Looney did tell Reuters that one-fifth of the redundancies will be in Great Britain.
67 percent lost
BP’s first quarter profit dropped with 67 percent in comparison to last year to 800 million dollar. The current oil price is below the profitability threshold of the British company. In response the company aims to cut 12 billion dollar on costs this year and an other 2,5 billion in 2021. The company thinks to cut costs through digitalisation and integration of it’s businesses.
Looney started in February as BP’s CEO with the promise to reinvent the company. To address that promise he already created eleven new divisions. Like most companies BP aims to be a net zero company by 2050.