OGUK fear up to 30,000 industry jobs could be lost, according to latest report

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7th May 2020 13:10 - Oil and Gas

OGUK fear up to 30,000 industry jobs could be lost: A report by Oil and Gas UK (OGUK) has warned that up  to 30,000 jobs are at risk due to the ongoing COVID-19 crisis - with a dramatic fall in revenue predicted for the industry. 

Due to the coronavirus pandemic, the industry has seen oil and gas prices fall to 20 and 14 year lows respectively. 

There are also concerns that the many companies will have difficulty in surviving another downturn, which OGUK fears couls be worse than that seen in 2015. 

The report which was published on Tuesday 28 April revealed that all E&P companies as well as 93% of supply chain firms were reporting a 'worse' or 'significantly worse' outlook for 2020. 

Fears are that CAPEX will plummet to between £3.5-4 billion (making it the lowest investment since 2000), whilst OPEX will fall to around £6-7 billion. 

Drilling activity is also expected to fall with experts predicting it could be down by 50% on last year's levels, which would be amongst record lows. Supply chain revenues and margins say OGUK could fall by 20-30 %,  in addition to reductions seen during the last downturn. 

While there are still great levels of uncertainty in terms of how businesses will be impacted, the industry body said that up to 30,000 jobs ( both direct and indirect jobs) could be affected over the next 12 - 18 months. 

The survey found that more than three-quarters of the supply chain businesses polled are planning to expand on their non oil and gas work in 2020. 

OGUK Chief Executive Deirdre Michie said: “Like so many industries, our members have been profoundly impacted by COVID-19. With historic low oil and gas prices coming so soon after one of the most severe downturns our sector has experienced, these findings confirm an especially bleak outlook for the UK’s oil and gas industry."

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