Oil services company Schlumberger has cut 10,000 jobs in the face of the continuing oil price slump.
The firm said in its latest quarterly report that it shed 10,000 jobs, nearly 10 per cent of its workforce, over the last three months. It unveiled a net loss of $1 billion over the period, its first quarterly loss in 12 years.
Revenue for the period decreased 39 per cent to $7.74 billion, while full-year revenue for 2015 was down to $35.5 billion, a year-on-year decrease of 27 per cent.
Schlumberger Chairman and CEO Paal Kibsgaard said the decrease was in line with upstream spending cuts that resulted in greatly reduced exploration and production investment.
"North America revenue declined 39 per cent, with land falling 45 per cent while offshore was down 17 per cent," Mr Kibsgaard said. "The decrease in land activity was the sharpest seen since 1986, as capex spending by North American customers declined by more than 40 per cent.
"With the year-end US land rig count 68 per cent lower than the 2014 peak, at less than 700 rigs, the massive over-capacity in the land services market offers no signs of pricing recovery in the short to medium term."
Schlumberger also announced a $10 billion share buy-back programme that pushed shares four per cent higher in after-hours trading.
The job cuts add to 20,000 already announced by Schlumberger in 2015.
This week the oil price fell to below $28 per barrel, and with Iranian oil entering the market after the end of Western sanctions there are few signs of a rebound. Royal Bank of Scotland economists have predicted that the price could fall as low as $16 per barrel, a near-90 per cent drop from highs of $115 in 2014.
While the low oil price was the primary source of Schlumberger's decline in revenue, Mr Kibsgaard also pointed to the strength of the dollar. "Full-year revenue for the International Areas declined 21 per cent due to customer budget cuts of more than 20 per cent, as international and national oil companies responded to lower commodity prices," he said.
"This effect was exacerbated by service company pricing concessions. More than one-third of the revenue decline was the result of the fall of certain currencies against the US dollar."
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