Energy doldrums force Boskalis to cut fleet, staff

Updated 08 July 2016
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Energy doldrums force Boskalis to cut fleet, staff

AMSTERDAM: Dutch offshore engineer Boskalis said it was cutting 650 jobs worldwide and culling 24 vessels in response to what it called drastic changes in the company’s outlook caused by low energy and commodity prices.
The job cuts, including 150 Dutch employees, would be made over the next two years from a workforce of about 8,000, the company said.
The company will take 10 vessels out of service at its dredging division and 14 at its offshore energy division because poor market conditions were likely to persist.
Falls in available work meant utilization of the 150-strong fleet was under pressure, CEO Peter Berdowski said. “Because we expect these market conditions to persist, is is essential that we adapt the size and composition of our fleet.”
The vessels to be scrapped or sold have an average age of 30 years.
Boskalis, in common with most dredgers around the world, flourished during an earnings bonanza around Egypt’s Suez Canal enlargement project that ended last year. No projects of comparable scale have since been forthcoming.
Offshore engineers have been hit hard by low oil and commodity prices, which have forced energy companies to cut exploration budgets and extract less of the hard-to-reach deposits in which they specialize.


Saudis cut, Russians hiked output ahead of pact: IEA

Updated 11 min 7 sec ago
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Saudis cut, Russians hiked output ahead of pact: IEA

  • OPEC members along with allies including Russia agreed in early December to trim production by 1.2 mbd from Jan. 1

PARIS: Saudi Arabia demonstrated its resolve to lift oil prices by slashing output ahead of the entry into force of new pact limiting production while Russia boosted output to a record level, the International Energy Agency said Friday.
World oil markets have been on a rollercoaster ride in recent months, with OPEC and its partners including Russia, often called OPEC+, agreeing to cut back production again from January in order to reverse a slump in oil prices on abundant production and worries about slower global growth.
In its latest monthly report, the Paris-based International Energy Agency said the Saudis took the lead by cutting output in December as prices tumbled by more than a third in just two months.
“Recently, leading producers have restated their commitment to cut output and data show that words were transformed into actions,” said the IEA.
“While Saudi Arabia is determined to protect its price aspirations by delivering substantial production cuts, there is less clarity with regard to its Russian partner,” it added.
But the cut was mostly due to the Saudis, with data indicating several OPEC members increased production last month.
The IEA said data show that Russia increased crude oil production in December “to a new record near 11.5 mbd (million barrels per day) and it is unclear when it will cut and by how much.”
OPEC members along with allies including Russia agreed in early December to trim production by 1.2 mbd from Jan. 1, in a bid to eliminate a production glut and shore up prices.
Just months earlier, they had relaxed production caps as prices shot higher on market worries about the impact of US sanctions on Iran, but Washington eventually granted waivers allowing several countries to continue to import Iranian oil.
Meanwhile, US production rose considerably more than expected last year, adding further to supplies, while concerns about demand emerged as the US-China trade spat deepened in the second half of last year.
The IEA said the US increased output by 2.1 mbd last year, the “highest ever” annual growth ever recorded.
The boom of shale oil production in the US this decade has redrawn the map of global energy politics as the nation no longer depends as heavily on imports and has even resumed exports.
The IEA said “the US, already the biggest liquids supplier, will reinforce its leadership as the world’s number one crude producer” in 2019.
“By the middle of the year, US crude output will probably be more than the capacity of either Saudi Arabia or Russia.”
The IEA left its estimate for global oil growth in 2019 unchanged at an increase of 1.4 mbd, saying “the impact of higher oil prices in 2018 is fading, which will help offset lower economic growth.”
It said there were signs that the rebalancing of the oil market will be gradual.