BP cuts 15% of jobs due to COVID and green energy transition

Oil giant BP will cut 15% of its workforce, Reuters exclusively reports today. This is a result of the coronavirus impact on the economy, and also CEO Bernard Looney’s plan to shift the fossil-fuel company to green energy, it said today.

The UK-headquartered company will cut 10,000 jobs from the current 70,100 positions. Staff were told of the cuts by Looney, who became CEO in February, in a global online call.

About one-fifth of the redundancies will be in the UK, and cuts will mostly consist of senior office-based positions. BP will give no pay raises to senior employees until March 2021.

BP has flagged a 25% cut to $12 billion this year, and Looney said the company would need to cut costs even further.

BP isn’t alone in job cuts in the fossil-fuel industry: US-headquartered Chevron is cutting between 10% and 15% of its global workforce, and Royal Dutch Shell has implemented a voluntary redundancy scheme.

BP’s path to renewables

Looney addressed the shift to green energy in the call by saying:

It was always part of the plan to make BP a leaner, faster-moving, and lower-carbon company.

BP said the pandemic accelerated those plans.

On February 12, as Electrek reported, BP announced that it will become a net zero company by 2050 or sooner. It did not say it would move away entirely from fossil fuels. The company listed five points that they say will help them achieve zero emissions:

1. Net zero across BP’s operations on an absolute basis by 2050 or sooner.

2. Net zero on carbon in BP’s oil and gas production on an absolute basis by 2050 or sooner.

3. 50% cut in the carbon intensity of products BP sells by 2050 or sooner.

4. Install methane measurement at all BP’s major oil and gas processing sites by 2023 and reduce methane intensity of operations by 50%.

5. Increase the proportion of investment into non-oil and gas businesses over time.

Electrek’s Take

This isn’t surprising news: Oil giants are taking a pounding due to lack of demand as a result of the coronavirus pandemic, and BP is going to undergo a major restructure anyway in order to transition away from fossil fuels.

But it would be good to retrain those laid-off employees to employ them in green energy roles. It’s a painful effect of major change for a lot of people; surely those now-jobless people could benefit from the positive movement toward net zero?