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HOUSTON (REUTERS) – Exxon Mobil Corp said on Thursday (October 29) that it could reduce the number of global employees by 15 percent and lay off some 1,900 employees in the United States as the Covid-19 pandemic hits demand and energy prices.
Exxon was once the largest publicly traded US company, but it has been cutting costs due to a collapse in demand for oil and ill-timed bets on new oil fields and expansions.
It promised to spend more than US $ 10 billion (S $ 13.7 billion) this year in project expenses and cut operating expenses by 15%.
An estimated 14,000 employees worldwide, or 15 percent, could lose jobs, including contractors, spokesman Casey Norton said. The cuts would include everything from layoffs to retirements to performance-based departures.
Exxon had about 88,300 workers last year, including 13,300 contractors. “We are not targeting a downsizing percentage,” Norton said, adding that the “bottom line” of its country-by-country reviews “may be close to 15 percent of our global workforce.”
The company lost nearly $ 1.7 billion in the first six months of the year and is expected to post another quarterly loss on Friday.
Exxon said the job cuts, part of a global reorganization, will come primarily from its Houston, Texas office and will include voluntary and involuntary cuts.
“The impact of Covid-19 on demand for Exxon Mobil products has increased the urgency of ongoing efficiency work,” the company said in a statement.
Employees who are separated through involuntary programs will receive severance and relocation services. Earlier this month, it said it would cut 1,600 jobs in Europe. It has also announced cuts in Australia.
Exxon shares rose 2.9 percent to $ 32.50 on Thursday.
Before the pandemic, Chief Executive Officer Darren Woods pursued an ambitious spending plan to boost oil production on the bet that a growing global middle class would demand more of his products.
Royal Dutch Shell and BP have also described staff cuts of up to 15%. The cuts planned by Chevron Corp from 10 to 15 percent would imply a reduction of between 4,500 and 6,750 jobs. It will also cut approximately another 570 positions as part of its acquisition of Noble Energy.
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