HOUSTON (Bloomberg) - The promise of plentiful jobs and salaries as high as a quarter-million dollars a year lured Colombia native Clara Correa Zappa and her British husband to Perth, Australia, at the height of the continent's oil and gas frenzy.
Engineers were in high demand in 2012, when oil prices exceeded $100 a barrel, making the move across the world a no- brainer. Within two years, though, oil plunged to less than half the 2012 price and Zappa lost her job as a safety analyst. Now she's worried her husband, who also works in the commodities industry, could also lose his job.
Such anxieties are rising at a time when the number of energy jobs cut globally have climbed well above 100,000 as once-bustling oil hubs in Scotland, Australia and Brazil, among other countries, empty out, according to Swift Worldwide Resources, a staffing firm with offices across the world.
While much of the focus on layoffs has centered on the U.S., where the shale fields that created the glut have seen the steepest cutbacks, workers in oil-related businesses across the globe are suffering, he said.
The outlook isn't brightening. After briefly rising above US$50 this month, U.S. crude fell again Wednesday to settle at US$48.84 a barrel. Citigroup said oil could drop to "the US$20 range" by April as oversupplies build.
How long it will take for the job carnage to stop is now the main question confronting industry workers. Executives at companies including BP and Royal Dutch Shell have announced spending cuts of more than $US40 billion and assured investors they're ready to tighten further if the market doesn't recover significantly.
Australia stands out as especially hard hit, with a labor force already decimated by a slowdown in the coal mining industry.
Energy companies including BG and Woodside Petroleum, which are spending US$70 billion to build natural gas export plants in Australia, are seeing those projects delayed, postponed or winding down, leaving workers with nowhere to go after losing their jobs.
In Brazil, a graft scandal that led to the resignation of the CEO of state-run Petroleo Brasileiro SA on Feb. 4 has deepened the crisis surrounding oil. Brazil's bounty lies offshore in the Campos basin, a formation rich in hydrocarbons nestled beneath vast layers of salt that make drilling expensive and risky.
Mexico's oil prospects also are grim. In late 2013, the country began taking steps to revise its constitution and end a seven-decade monopoly, anticipating billions in investment from the world's biggest oil companies.
Petroleos Mexicanos, which employs 153,000 workers and has promised to protect them amid the oil rout, began slashing contracts and purchases this year in a bid to save US$2 billion to US$3 billion. That plan has left as many as 8,000 workers, many concentrated in the port city of Ciudad del Carmen, without work, said Gonzalo Hernandez, head of the city's Economic Development Chamber in Campeche state.
Around the North Sea, where drilling is serviced largely from Aberdeen, Scotland and Stavanger, Norway, job cuts now exceed 11,500, according to DNB Markets and Unite, the U.K.'s largest labor union. As many as 30,000 more may disappear, according to Menon Business Economics AS. BP wrote down the value of its North Sea operations by US$3.6 billion, and CEO Bob Dudley on Feb. 3 gave dire warnings about the region's future.