BP plc, a multinational oil and gas company, has recently announced its plan to lay off 15% of its workforce due to the ongoing coronavirus crisis. This announcement goes in line with the plan of Bernard Looney, the company’s Chief Executive to shift its focus from the oil & gas major to renewable energy.

The layoff plan of the London-based company will impact over 10,000 jobs from the current strength of 70,100 employees by the end of 2020. The employees who are likely to be affected by the recent plan are those with senior office-based positions, not the operational staff who are on the frontline.

The shares of the company increased by 3.3% against a 2.2% gain for the broader energy sector in Europe.

The office based in Britain, with a 15,000-employee strength, will reportedly face nearly one-fifth of the job cuts. Due to the unprecedented drop in the oil demand during the COVID-19 pandemic, several top energy companies, including BP, have reduced their spending plans for 2020. The company has flagged a reduction of 25% to $12 billion in 2020. It further intends to have $2.5 billion in cost savings via integration and digitalization of its businesses by 2020 end.

The oil & gas company is also reportedly not offering pay rises for senior employees until March 2021 & is unlikely to give any cash bonus in 2020. This will effectively contribute to Looney’s transition plan to transform BP into a faster-moving, low-carbon company, highly accelerated and amplified by the current pandemic.

In addition to BP, several other oil producers have also planned to reduce their global workforce. For instance, in May, Chevron has stated that it will reduce around 10% to 15% of its workforce globally, as a part of its ongoing restructuring plan. Additionally, Royal Dutch Shell has also initiated a program for voluntary redundancy.

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https://www.channelnewsasia.com/news/business/bp-oil-cuts-15-per-cent-workforce-12815984