Oil major BP plans to cut at least 4,000 jobs globally in its oil production division this year to reduce costs amid a steep decline in oil prices. Hayley Platt reports.
Falling oil prices take their toll again. This time BP has announced plans to slash 5 percent of its global workforce. It wants to reduce the headcount by between 4,000 and 20,000. And cut the amount of oil it produces. The majority of cuts will be made in 2016, with 600 jobs going from its North Sea operations. It comes as the price of oil heads towards $30 a barrel for the first time in 12 years. And it could fall further, says GKFX's James Hughes. (SOUNDBITE) (English) GKFX, CHIEF MARKET ANALYST, JAMES HUGHES, SAYING: "I think we can look to 20 dollars (at the moment and of course there are predications of 20 dollars. And) I think that is the area when you look at Saudi Arabia and the Middle Eastern producers, that is the area that it tends to get a little bit more difficult for them to make money off the back of the stockpiles that they have in place." The cuts are part of a $3.5 billion restructuring programme, which was partly designed to help pay $20 billion in fines for the Gulf of Mexico spill. It's sold over $50 billion of assets to cover that disaster. BP shares have fallen around 40 percent since the price of oil began sliding in mid-2014. They rose over 2 percent after the announcement. Other oil companies including Royal Dutch Shell and Chevron have also slashed tens of thousands of jobs in response to the near 75 percent drop in oil prices. And further falls in earnings from production by oil majors are expected. The new BP cuts will also be a blow to the British economy - new figures show industrial output was down 0.7 percent in November.