Schlumberger slashes 21,000 jobs amid pandemic oil rout

Schlumberger paid out $1 billion in severance benefits. (Shutterstock)
Short Url
Updated 25 July 2020

Schlumberger slashes 21,000 jobs amid pandemic oil rout

  • Global oilfield services giant cuts a quarter of its workforce after bruising second quarter sends revenues plunging

BENGALURE: Oilfield services giant Schlumberger NV on Friday reported its second straight quarterly loss after recording a $3.7 billion charge related to thousands of job cuts and a major pipeline outage in Ecuador.

The company cut about 21,000 jobs amid a steep crash in oil prices that has prompted a pullback in drilling activities. It reported $1.02 billion in severance costs for the second quarter for dismissed workers and recorded a $666 million charge related to asset impairments in Latin America, after a landslide ruptured a pipeline.
The company rounded off second-quarter earnings reports from major US oilfield services providers this week that laid bare the damage wreaked by the coronavirus crisis, particularly in North America.
Although crude prices have recovered from the historic declines in March and April, they are still down around 33 percent for the year, and fears of a COVID-19 resurgence are challenging the company’s outlook about a near-term normalization of oil prices, CEO Olivier Le Peuch said in a statement.

BACKGROUND

Weak oil prices made worse by the reduced demand caused by coronavirus-related lockdowns has had a devastating impact on the major oilfield services companies, especially in the North American shale sector which requires higher oil prices to remain profitable.

Schlumberger, which is restructuring its business to adjust to the price crash, said North America revenue fell to $1.18 billion in the second quarter, less than half of what it was a year earlier, with only slightly better conditions expected in the current quarter.
“The conditions are set in the third quarter for a modest frac completion activity increase in North America, though from a very low base,” Le Peuch said, referring to hydraulic fracturing activities used to complete oil wells.
The world’s largest oilfield services provider reported a net loss of $3.43 billion, or $2.47 per share, for the second quarter, compared with a profit of $492 million, or 35 cents per share, a year earlier.
Excluding charges and credits, the company earned 5 cents per share.


Dubai launches economic program for post COVID-19 recovery 

Updated 05 August 2020

Dubai launches economic program for post COVID-19 recovery 

  • “The Great Economic Reset Programme” is part of a “COVID Exit initiative” to help the recovery and reshaping of the economy
  • The economic program will feature analyses of current and future policies

DUBAI: Dubai launched an economic program as part of its efforts to reshape the emirate’s economy for a “sustainable” and “resilient” future post the coronavirus pandemic, the government said. 
The Dubai government partnered with the Mohammed bin Rashid School of Government (MBRSG) to launch “The Great Economic Reset Programme” as part of a “COVID Exit initiative” to help the recovery and reshaping of the economy, state news agency WAM reported on Tuesday. 
The economic program will feature analyses of current and future policies, research and extensive stakeholder consultation to set the direction and tone of future economic policies, regulations and initiatives.
The government plans to use local and international experts for economies and societies to create growth strategies for the Dubai economy.
The MBRSG held a “Virtual Policy Council,” with global experts and thought leaders to discuss the impacts of COVID-19 on the economy and potential policy responses and initiatives. 
Chief economists, senior practitioners and researchers from leading global institutions including the World Bank, joined experts from Dubai Economy and the MBRSG at the first roundtable.
“I believe the triple helix collaboration between public, private and academia stakeholders have always produced the best solutions in the past. In the highly uncertain environment now, extensive collaboration and cooperation between all stakeholders are vital to our future prosperity. The Virtual Policy Council will propose the best approaches Dubai and the UAE can adopt to address the risks and opportunities in the next normal economy,” said Mohammed Shael Al-Saadi, CEO of the Corporate Strategic Affairs sector in Dubai Economy.
“This Virtual Policy Council is a key component of the whole process where global experts and thinkers share their views on the future economy. In this new era, the role of governments in enabling the new economic actors is becoming increasingly central, and Dubai is well-positioned to lead the way with innovative models of growth post COVID19,” said Professor Raed Awamleh, Dean of MBRSG.
The roundtable also discussed the impact of the pandemic on international trade, foreign investment and tourism, as well as the rise of digital globalization.