Oil and Gas Companies to Axe New Jobs?

Operators cannot simply rely on squeezing the service sector, but need to focus on project optimisation and other measures to push prices down, Wood Mackenzie said on Monday.  

‘While operators are seeking an average cost reduction of 20-30% on projects, supply chain savings through squeezing the service sector will only achieve around 10-15% on average. In order to ensure projects are economically viable, operators will also need to focus on and adopt smarter ways of working with the service sector’ Wood Mackenzie wrote on its website. 

The service sector is expected to suffer in the next years, as a reduced investment environment might drastically impact on new projects. 

"Additional measures are needed to manage costs: re-working field development plans, optimising project design and more innovative approaches to project management will all play important parts," James Webb, Upstream Research Manager for Wood Mackenzie, said, adding that oil prices should recover from 2017.

On Monday, reports indicated that Bilfinger could be issuing another round of redundancies notices, with 200 positions at risk.

Earlier this month, the UK's new Oil and Gas Authority (OGA) wrote that Britain's North Sea oil and gas sector has shed some 5,500 jobs since late 2014 over a year-long decline in oil prices.