LONDON/MOSCOW (Reuters Life!) - There will be fewer high octane parties and a clamp-down on champagne-fueled frolics for oil traders and brokers at International Petroleum Week in London next week.
Oil majors Chevron and Lukoil, alongside other firms have decided not to host receptions in a bid to cut costs.
“Two big omissions from last year. I will be busy enough but less busy than previous years,” one broker lamented.
Hundreds of traders and brokers travel from around the world to attend presentations and socialize at evening events from Monday to Thursday. But this year won’t be a patch on the fun they’ve been having over the last six boom years.
Next week’s gathering comes as oil prices have collapsed by more than $100 a barrel since last summer due to slowing demand that has hurt profits at oil companies. Oil’s six-year rally ended in 2008.
“In the current environment, like all companies, we have been looking at our overall cost structure and have taken the decision not to hold a reception this year at IP Week,” a spokesman for U.S. company Chevron said.
Not only has Lukoil, Russia’s largest private oil company, decided not to hold a reception, it has also banned its Moscow-based traders from flying to London, a source at the company said.
Kazakh oil producer KazMunaiGas has also dropped its reception to cut costs, a company source told Reuters.
Some big oil companies have not hosted parties at IP Week for years. BP said it stopped about four years ago. Trading sources said the main reason for BP’s move was to cut costs.
Industry analysts forecast prices will average at much lower levels this year than last year due to falling demand as the global economy slips deeper into recession.
Reporting by Alexander Yershov in Moscow, Ikuko Kao and Joe Brock in London; editing by Alex Lawler and Sue Thomas