(Bloomberg) -- The hired hands of the global oil industry probably will shed more than 1 million jobs this year due to collapsing crude prices, according to Rystad Energy.
The oil services industry, which explorers hire to map underground reservoirs, drill wells and rejuvenate older fields, employs more than 5 million across the globe today, according to the Norway-based industry consultant. Rystad is forecasting a 21% contraction in that workforce this year, a staggering blow but still not as bad as the 30% loss exacted during the depths of the last crash in 2016.
“Low oil prices are likely to persist in 2021 and could lead to further workforce reductions,” Audun Martinsen, Rystad’s head of oilfield service research said Wednesday in a report. “E&P operators and contractors want to minimize the potential spread of Covid-19 by reducing the workforce to an absolute minimal level.”
North American shale, which Schlumberger Ltd. and Halliburton Co. warned on Tuesday will decline faster than during the last downturn, will feel the greatest job-cut pain, losing as much as 32% of its workforce, according to Rystad. Offshore contractors will shed 19% this year, and onshore jobs around the globe outside of shale will drop by 17% this year.
Nabors Industries Ltd., owner of the world’s biggest fleet of onshore rigs, plans to suspend its dividend and slash C-suite pay. First-quarter earnings will fall short of guidance, the company said on Wednesday.
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