Halliburton, Baker Hughes to lay off thousands as oil slumps

Tue Jan 20, 2015 12:05pm EST
 
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By Swetha Gopinath and Shubhankar Chakravorty

(Reuters) - Oilfield service providers Baker Hughes Inc and Halliburton Co plan to cut thousands of jobs as drilling activity slows further due to a steep fall in crude oil prices.

Global oil prices have tumbled almost 60 percent since June, hitting five-year lows as growing production and tepid global demand has caused a supply glut and prompted oil producers to scale back spending.

"We expect our headcount adjustments to be in line with our primary competitors," Halliburton's Chief Operating Officer Jeffrey Miller said on a post-earnings call on Tuesday, without giving a specific number.

The company, which employees more than 80,000 people, said it cut 1,000 jobs in its operations in the eastern hemisphere in the fourth quarter.

Baker Hughes, which is being acquired by Halliburton in a near-$35 billion deal, said earlier in the day it would lay off 7,000 employees.

Shares of Halliburton and Baker Hughes were down about 2 percent in morning trading, reversing earlier gains after the companies posted better-than-expected fourth-quarter results due to resilient demand.

The job cuts, which come days after industry leader Schlumberger NV said it would cut 9,000 jobs, underscore the abrupt slowdown in drilling activity seen in the past two months.

The U.S. land rig count has fallen by 250 rigs, or about 15 percent, over the last 60 days, Halliburton Chief Executive Dave Lesar said on the call.   Continued...

 
Traders work by the post that trades Baker Hughes on the floor of the New York Stock Exchange November 17, 2014. REUTERS/Brendan McDermid