As oil price slump bites, BP announces global pay freeze
Energy giant BP said on Tuesday it was freezing global salaries following a sharp drop in oil prices, less than a fortnight after announcing 300 job cuts in the North Sea.
“We informed staff throughout BP that we intend to freeze base pay across the company for 2015, with only a select few necessary exceptions,” a spokesman said.
“We see this as a prudent response to the currently challenging market environment in which we are operating,” he added, in reference to a slump of more than 50 per cent in global oil prices since June.
The pay freeze was relayed to staff in an email from BP chief executive Bob Dudley on Monday. In December, BP took a restructuring charge totalling about $1.0 billion in a company-wide overhaul of the business. As part of that plan, BP announced earlier this month that it was shedding 200 staff jobs and 100 contractors, all of them onshore, at its North Sea operations.
Speaking to the BBC last week from the World Economic Forum in Davos, Dudley said his company must face the possibility that oil prices will stay low for some time.
“Companies like us, at BP, we’re going to need to rebase the company based on no guarantees at all that the price will come back up,” he said.