Schlumberger cuts 9,000 jobs in response to plunging oil prices

The world’s largest oil-field service company, Schlumberger, said yesterday that it has laid off 9,000 workers in response to plunging oil prices, cutting its global headcount by around 7%.

“In response to lower commodity pricing and anticipated lower exploration and production spending in 2015, Schlumberger decided to reduce its overall headcount to better align with anticipated activity levels for 2015,” the company said while announcing its 2014 results.

“Schlumberger recorded a $296 million charge associated with a headcount reduction of approximately 9,000,” it added.

Schlumberger now employs approximately 120,000 people in more than 85 countries.

2014 was still a good year for the company, however.

“Full-year 2014 revenue of $48.6 billion increased 7% year-on-year and grew for the fifth consecutive year,” noted Schlumberger CEO Paal Kibsgaard. “Performance was driven by North America where revenue grew 16%, while International Area growth of 4% was led by a 10% increase in Middle East & Asia Area revenue.

“Full-year pretax operating income grew by 13%, with pretax operating margin expanding 113 basis points to 21.8%. International margin expanded by 168 basis points to reach 23.9%, reflecting an incremental operating margin of 69%.”

Among the challenges it cited were unrest in Libya and Iraq and international sanctions in Russia.