BP accelerates restructuring plans

BP is set to accelerate plans to cut back-office department jobs in the wake of falling oil prices.

Blue avatar for FOREX.com guest contributors
By :  ,  Financial Analyst

Falling oil prices have prompted BP to accelerate its job cuts.

The oil giant has been planning to make considerable alterations to its back-office departments in both the US and the UK but is expected to speed up the process after sharp falls in oil prices. Both brent crude and US oil have been dropping in cost since the turn of the year with the former falling 40 per cent since January.

These significant drops prompted a meeting of the Organization of the Petroleum Exporting Countries (Opec) to decide where or not to reduce production in a bid to stimulate prices. The move was opposed by the United Arab Emirates and Saudi Arabia along with non-Opec member Russia. Venezuela and Iraq had been in favour of output cuts but the decision was taken to maintain current rates.

A decision to keep the output levels unchanged has prompted BP to accelerate its job cuts. The company has been downsizing after it was the subject of huge criticism following an oil spill in the Gulf of Mexico in 2010. The cuts have been in the pipeline for a long time, BP stated, but the fall in oil prices has led to more decisive action being taken.

Speaking to the BBC, a BP spokesman said: "The fall in oil prices has added to the importance of making the organisation more efficient and the right size for the smaller portfolio we now have."

BP currently has a workforce of 84,000 people across the globe with 15,000 of those being based in the UK. The company has offices in London, Milton Keynes, Aberdeen and Subury on Thames among other locations and when the cuts are made it is expected to be the UK and the US base in Texas which bears the brunt.

The company is expected to outline details of the cuts on Wednesday (December 10th).

Find up to date information on spread betting strategies at City Index

Related tags:

Open an account today

Experience award-winning platforms with fast and secure execution.

Web Trader platform

Our sophisticated web-based platform is packed with features.
Economic Calendar