Oil services giant Schlumberger says 21,000 jobs to go

Oil services group Schlumberger expects to lay off more than 21,000 employees – a quarter of staff – it said on Friday, July 24, also reporting a $3.4-billion quarterly loss.

The Texas-based firm announced a series of charges totaling $3.7 billion, including more than $1 billion for severance pay “associated with reducing Schlumberger’s workforce by more than 21,000 employees.” 

The firm said that the vast majority of the charge is expected to be paid during the 2nd half of 2020.

Oil producers have been hit hard by the fall in global crude prices as lockdowns adopted to slow the spread of the novel coronavirus hit demand for energy.

In reaction, firms have slashed investment, impacting firms like Schlumberger which carry out many activities related to exploration and the development of oil fields.

“This has probably been the most challenging quarter in past decades,” chief executive officer Olivier Le Peuch said in the earnings statement.

He pointed to a 28% drop in revenue from the 1st to 2nd quarter. The $5.4 billion was 35% down from April-June 2019.

“This speaks volumes about an industry confronted with historic oil demand and supply imbalances caused by demand destruction from the global COVID-19 containment effort,” said Le Peuch. – Rappler.com