HOUSTON • ExxonMobil will slash its global workforce by 15 per cent by the end of 2022, an unprecedented culling by North America's biggest oil explorer as it reels from Covid-19's impact on energy demand and prices.
The cuts will include 1,900 jobs in the United States, mostly in Houston, as well as layoffs previously announced in Europe and Australia, and reductions in the number of contractors, some of which have already taken place.
ExxonMobil yesterday reported it lost US$680 million (S$928 million) in the third quarter, against US$3.2 billion in profit in the year-ago period. The loss was its third straight quarter of red ink.
It also said it plans to cut its capital spending for next year to between US$16 billion and US$19 billion from a planned US$23 billion this year.
ExxonMobil's job cuts, announced on Thursday, means the company will reduce its 88,000 workforce by about 14,000 people, split between employees and contractors, from year-end 2019 levels, spokesman Casey Norton said. The cuts will come through attrition, targeted redundancy programmes next year, and scaled-back hiring in some countries.
The company has a headcount of more than 4,000 in Singapore, according to its website.
When contacted, a spokesman in Singapore told The Straits Times that the company is undertaking a country by country review. "It would be premature to draw any conclusions about Singapore until the review is complete," the spokesman said.
ExxonMobil's Big Oil rivals are also cutting thousands of jobs in response to the demand slump sparked by the coronavirus pandemic. BP plans to slash 10,000 jobs, Royal Dutch Shell will cut as many as 9,000 roles and Chevron has announced around 6,000 reductions.
The fact that ExxonMobil is cutting jobs at all is a sign of its weakened financial position compared to its former status as the S&P 500 Index's biggest company less than a decade ago and a profit powerhouse used to riding out oil-price cycles.
This year's downturn has been particularly damaging because it affected refining, usually a cushion in times of low oil prices, and because it came at a time when ExxonMobil was already increasing borrowing to fund a large expansion programme. The company was forced to retreat on these plans in April, reducing capital spending by US$10 billion and delaying or scaling back most of its major projects.