Exxon to Lay Off 1,900 U.S. Employees as Pandemic Wreaks Havoc on Oil Demand
October 29 2020 - 12:16PM
Dow Jones News
By Christopher M. Matthews
Exxon Mobil Corp. said Thursday that it would lay off 1,900
employees in the U.S., becoming the latest major oil company to
reduce its workforce as the coronavirus pandemic continues to
batter the industry.
The struggling oil giant said most of the cuts would come from
its management offices in Houston and that it expects the
reductions will be both voluntary and involuntary. Exxon has said
it is conducting a global review of its 74,000 employees and
previously announced 1,600 layoffs in Europe and voluntary layoffs
in Australia.
Exxon made the announcement a day before it is set to report
quarterly earnings. Analysts expect the company to post its third
consecutive quarterly loss for the first time on record.
Despite a modest economic recovery, oil-and-gas companies are
being hammered by a sustained drop in consumption of gasoline and
jet fuel as millions of people work from home and avoid driving and
flying during the pandemic.
New lockdowns in Europe in response to climbing Covid-19 cases
are dampening hopes that the global economy will regain its footing
this year. That is combining with longer-term concerns about future
competition from renewable energy and electric vehicles to drag
down the value of many oil-and-gas companies to decade lows.
The oil-and-gas industry has shed tens of thousands of jobs and
many of Exxon's peers have already announced significant
layoffs.
Royal Dutch Shell PLC said in September it would cut up to 9,000
jobs in a broad restructuring and BP PLC plans to cut nearly 10,000
jobs, or 14% of its workforce, and freeze pay increases for senior
level managers. U.S. rival Chevron Corp. has said it would reduce
its 44,679 workforce by as much as 15%.
Exxon's shares have fallen more than 50% this year and the
company has had to borrow billions of dollars to pay its costly
dividend. Shell and BP cut their dividends earlier this year to
shore up their finances. Exxon and Chevron said this week they
would maintain their current dividend payments.
Write to Christopher M. Matthews at
christopher.matthews@wsj.com
(END) Dow Jones Newswires
October 29, 2020 12:01 ET (16:01 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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