With another 1,000 workers laid off earlier this week, giant oilfield services provider Halliburton has decreased its workforce by around 5,000 since the oil price collapse.
According to a report by the Houston Chronicle , Halliburton laid off around 1,000 employees at its headquarters earlier this week as low crude prices take their toll on the demand for the company’s services.
The company stated that this week’s layoffs were caused by an “unforeseeable, dramatic business downturn” over the coronavirus and unprecedented commodity price decline.
The 1,000 laid-off workers now join the previously furloughed 3,500 employees, all from the Houston headquarters, as well as workers from two locations in Texas and 240 laid-off workers in Oklahoma.
“The reductions are in addition to layoffs across the company’s global operations. These actions are difficult but necessary as we adjust our business to customers’ decreased activity ”, the company said in a statement quoted by the Houston Chronicle.
Oil prices have dropped significantly from more than $60 a barrel at the beginning of 2020 to less than $25.
In April, U.S. crude prices plunged into negative territory for the first time in history, meaning producers had to pay customers to take their oil. Also, producers shut down wells and stopped completing those they have been drilling impacting a large part of Halliburton’s U.S. business.
It is worth noting that Halliburton started the year with 55,000 employees across the world, but the workforce has now shrunk to about 50,000 people, according to a filing with the U.S. Securities and Exchange Commission from April 24.
More than half of those job cuts happened over the last month at locations in Texas, Oklahoma, Louisiana, and Colorado.
In related news, Halliburton recently booked a $1 billion loss in the first quarter of this year compared to a profit in the same period of 2019 due to the combination of low oil demand and resulting oversupply being further exacerbated by the coronavirus pandemic.
Also, the company stated after the first quarter financials were out that its full-year 2020 capex budget would stand $800 million, 33 per cent below previous guidance. That is the first sub-$1 billion budget since the last crash in 2016.