Shell To Ax More North Sea Jobs Despite U.K. Tax Cuts (Investor's Business Daily)

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  • March 26, 2015
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Royal Dutch Shell (NYSE:RDSA) announced plans Thursday to cut another 250 jobs from its North Sea operations this year amid declining production in the mature field and lower oil prices. The latest layoffs follow the energy giant’s announcement in August to cut 250 jobs there. Peers have made similar moves, with BP (NYSE:BP) saying in January it would cut 300 North Sea positions as oil prices continued to plunge.
The layoffs come despite the U.K. offering tax cuts last week to help spur investment in the region. Getting a barrel of oil from the North Sea is now five times more expensive than it was in 2001, according to an earlier report by the U.K.’s Telegraph.
Shell shares were down 1.7% on the stock market today, despite a rise in oil prices sparked by airstrikes by Saudi Arabia and allies in Yemen. BP was off 0.5%, Exxon Mobil (NYSE:XOM) 0.7% and Chevron (NYSE:CVX) 1.3%.
Companies that supply equipment to the energy sector are also trimming headcounts. On Wednesday, General Electric (NYSE:GE) expanded the number of job cuts from its Lufkin oilfield equipment division to 575 from 500. In January, it had only planned to cut 330 jobs.
“As a result of increasingly challenging market conditions, today we are announcing additional workforce reductions,” said Laura Bauer, a spokesperson at the company.
Shares dipped 0.5% Thursday.
Follow Gillian Rich on Twitter: @IBD_GRich.