More than 500 North Sea workers face redundancy as EnQuest battles to save £275m amid plunging oil price putting up to 30,000 UK energy jobs at risk
- More than 500 North Sea workers are expected to be made redundant
- EnQuest started a consultation with UK staff as it tries to make £275m savings
- It comes after Oil and Gas UK warned up to 30,000 jobs could be lost
- Here’s how to help people impacted by Covid-19
More than 500 North Sea workers are facing redundancy as oil prices plummet.
Oil and gas operator EnQuest has started a six-week consultation with UK staff as it tries to make £275 million in savings this year.
It announced plans to make 530 redundancies as it expects economic production at two of its North Sea fields to come to a halt in the second half of 2020, and it no longer plans to restart work at two others.
The market has faced challenges since the price of U.S. oil crashed into negative for the first time in history last month as demand dried up and the cost to have a barrel of U.S. crude delivered plummeted to negative $37.63 amid the coronavirus crisis.
The sharp drop came because traders were expected to run out of places to store it – meaning they were paying buyers who had space to take the barrels off their hands.
A spokeswoman said: ‘EnQuest Plc can confirm it has begun a six-week collective consultation with UK employees as it takes decisive action to manage the business in the current challenging economic environment.
‘Given the prevailing low oil price and global demand, the group has reviewed each of its assets and related spending plans.
Oil and gas operator EnQuest has started a six-week consultation with UK staff as it tries to make £275 million in savings this year (file image)
‘This reduction in operational activity will inevitably lead to resource reductions, although EnQuest is seeking to keep this to a minimum.
‘EnQuest expects to reduce the number of roles by 530.
‘The company expects to have the new organisation established in Q3 2020.’
The revelation comes as:
- Health Secretary Matt Hancock pledged that from today Department of Health daily updates will include people who died in places other than hospitals
- Schools across England will reopen in ‘phases’ that could mean either older or younger pupils are first back after lockdown
- Coronavirus tests run out just 80 minutes after ministers open screening to all over 65s and key workers – but government co-ordinator says only people with symptoms should apply
- A study shows men who catch coronavirus are more than twice as likely to die from the disease as women
Oil and Gas UK have warned up to 30,000 jobs could be lost in the sector.
Companies have been squeezed in recent weeks as the price of Brent crude, the main benchmark used by UK producers, dropped to lows not seen in more than 20 years.
It comes as BP said it slumped into a £3.5billion net loss in the first quarter as the coronavirus pandemic crushed demand for oil
BP said it slumped into a £3.5billion net loss in the first quarter as the coronavirus pandemic crushed demand for oil.
US oil prices collapsed once again today to approach $10 per barrel, but equities rebounded as nations began to ease lockdowns, with some light at the end of the tunnel after weeks of volatility.
New York’s West Texas Intermediate oil dropped 21 per cent to $10.07 after a major US exchange-traded fund started selling its short-term contracts of the commodity.
Chris Beauchamp, an analyst at trading firm IG, said: ‘Equities are rallying and oil is crashing, so it must be another normal day in this topsy-turvy market.’
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