Global Oil Job Cuts Top Quarter-Million as Rigs at Five-Year Low

(Bloomberg) -- The number of jobs gutted from oil and gas companies around the world has now passed the 250,000 mark, with still more to come, according to industry consultant Graves & Co.

"I was surprised it’s gotten this far," John Graves, whose Houston firm assists in oil and gas deals with audits and due diligence, said Friday in a phone interview.

The industry has idled more than 1,000 rigs and slashed more than $100 billion in spending this year to cope with oil prices that have fallen by more than half since 2014. Oil services, drilling and supply companies are bearing the brunt of the downturn, having accounted for 79 percent of the layoffs, according to Graves.

U.S. oil producers resumed their pullback on drilling this week, idling 10 rigs in an effort to cut costs and stem the rising tide of crude supplies that’s gutted oil prices to about $40 a barrel. The cuts extended a five-year low in activity after the two rigs added last week proved to be a short-lived pause in three months of downsizing.

While comparable numbers are hard to come by, the downsizing is still nowhere near as bad as the oil bust of the late 1980s, when Texas alone saw 240,000 jobs cut, Graves said. Yet, with today’s overhang in oil supplies still lingering, the layoffs still aren’t complete.

"It’s going to get worse before it gets better," he said.

--With assistance from Dan Murtaugh.

To contact the reporter on this story: David Wethe in Houston at dwethe@bloomberg.net To contact the editors responsible for this story: David Marino at dmarino4@bloomberg.net Susan Warren, Stephen Cunningha.

Copyright 2016 Bloomberg News.

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