Shell will axe up to 9,000 jobs worldwide after plunge in oil demand



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Royal Dutch Shell today announced plans to cut up to 9,000 jobs or more than 10 per cent of its workforce around the world. 

The oil and gas giant, which has about 83,000 global employees, said that the reorganisation will lead to annual savings of up to £2billion by 2022.

It said the job cuts are part of a major cost-cutting programme after the business was hit by the slump in demand for oil and a subsequent dive in prices. 



logo: Shell last month launched a review of its business aimed at deeply cutting costs (file picture)


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Shell last month launched a review of its business aimed at deeply cutting costs (file picture)



a close up of Ben van Beurden: Shell boss Ben van Beurden (file picture) wants to save £3.1billion by the end of next March


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Shell boss Ben van Beurden (file picture) wants to save £3.1billion by the end of next March

Shell last month launched a review of its business aimed at deeply cutting costs as it prepares to restructure its operations as part of a shift to low-carbon energy.

The Anglo-Dutch company said it expected to cut 7,000 to 9,000 jobs by the end of 2022, including 1,500 staff who have agreed to take voluntary redundancy this year.

In an operations update, Shell also said its oil and gas production was set to drop sharply in the third quarter to around 3,050 barrels of oil equivalent per day.

The company said this was due to lower output as a result of the Covid-19 crisis and hurricanes in the Gulf of Mexico that forced offshore platforms to shut down.



a sign above a store: Shell is said to be considering focusing on trimming costs at its 45,000-strong network of petrol stations


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Shell is said to be considering focusing on trimming costs at its 45,000-strong network of petrol stations

In 2019 the total cost of operations throughout the company was about £30billion, and boss Ben van Beurden wants to save £3.1billion by the end of next March. 

Morrisons creates 1,000 jobs to expand Amazon Prime service

Morrisons is creating more than 1,000 permanent jobs to fulfil orders for its services on Amazon.

The supermarket said it is hiring the extra staff to pick and pack customer orders from more than 50 stores, covering most major UK cities and many towns.

Grocers have been launching new ways to win customers during the Covid-19 pandemic, benefitting from lockdown and the slump in the restaurant and pub trade.

The move follows similar job creation plans by other supermarkets including Aldi, Tesco and Iceland, although it does little to offset the 125,000 jobs lost in the sector so far this year.

Morrisons does not have the same footprint as its larger rivals and does not have a convenience store portfolio, so bosses have been forced to find other ways to win new business.

The supermarket launched a deal with Amazon for delivery of store cupboard products, in addition to offering its own online service following a deal with Ocado.

During the pandemic – along with rivals – it launched services with Deliveroo and increased its work with the online food platform’s shareholder Amazon.

Through Amazon, Morrisons launched a Prime delivery service where shoppers can place orders to be picked and delivered in around 30 minutes.

The new jobs will fill positions to allow more orders to be placed.

On Monday the supermarket also revealed it had launched a new service to offer food boxes to students forced to self-isolate at university.

Earlier this year Morrisons revealed it had taken on 45,000 extra staff when coronavirus hit the UK, with 25,000 still in post. Around 6,000 had already been given permanent contracts.

Tesco has announced 16,000 permanent extra positions, Amazon 7,000 roles and delivery firms DPD and Hermes have also hired new recruits.

Today, he said: ‘We have had to act quickly and decisively and make some very tough financial decisions to ensure we remained resilient, including cutting the dividend. 

‘But as hard as they were, they were entirely the appropriate choices to make. And Covid-19 has hit us in another way. We have, very sadly, lost six employees and six contractor colleagues to the virus.’ 

He added: ‘We have to be a simpler, more streamlined, more competitive organisation that is more nimble and able to respond to customers.

‘To be more nimble, we have to remove a certain amount of organisational complexity.’

Mr van Beurden said the company is looking at a raft of other areas where it can cut costs, such as travel, its use of contractors and virtual working.

He said the pandemic has shown the company it can adapt to working in new ways but stressed that ‘a large part of the cost saving for Shell will come from having fewer people’.

Shell is said to be considering focusing its oil and gas production on a few key hubs, such as Nigeria, the Gulf of Mexico and the North Sea, and trimming costs at its 45,000-strong network of petrol stations. 

In a statement, Shell said: ‘Reduced organisational complexity, along with other measures, are expected to deliver sustainable annual cost savings of between $2billion (£1.6billion) to $2.5billion (£2billion) by 2022.

‘This will partially contribute to the announced underlying operating cost reduction of three billion dollars to four billion dollars by the first quarter 2021.’

Energy companies have come under increasing pressure from investors and governments to help the world move away from fossil fuels.

Rival BP has laid out extensive plans to invest in renewable technology and reach the key ‘net zero’ carbon emissions target by 2050 under new boss Bernard Looney.

In June, BP said it was cutting around 10,000 jobs from its workforce to cope with the impact of the virus. 

Some analysts believe demand for fuel will never recover back to 2019 levels after plummeting during the pandemic – which grounded planes, took cars off the road and disrupted industry.

Oil prices plunged from around $66 at the start of the year to as low as $19 – and are still only back at around $39 now.

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