As a result of the global oil glut that has been the cause of more than 350,000 jobs lost since late 2014, energy companies have been forced to make difficult decisions, including filing for bankruptcy. Houston-based contract drilling company Hercules Offshore, Inc. is one such company, and in fact, has filed for bankruptcy twice in a year’s time – most recently June 6.
As part of the bankruptcy process, Hercules anticipates a complete shutdown of its facilities. This has resulted in the permanent terminations of 60 employees at the company’s Houston headquarters, according to data sent to the Texas Workforce Commission (TWC).
A few weeks ago, GE Oil & Gas began its layoffs of 362 workers in Lufkin, Texas due to efforts to consolidate manufacturing operations in a “lower for longer” oil price environment. And just a few days prior to that, oilfield equipment supplier National Oilwell Varco communicated to the TWC it was laying off more than 50 workers at its Galena Park facility near Houston in July.
This downturn is being described as one of the worst in the industry’s history and with many organizations executing several rounds of layoffs, many are beginning to question ‘when will it end?’ And though the price of oil has eased its way up to $50 per barrel, the industry should be careful not to rally too prematurely because no one can truly predict what the market will do.
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