Maersk Oil, part of Danish conglomerate A.P. Møller-Maersk A/S, will cut 10% to 12% of its workforce as part of a plan to reduce operating costs by a fifth by the end of next year, amid weak oil prices.
The oil business of Danish conglomerate sets to cut 1,250 jobs this year. The planned cuts are part of a bid to reduce operating costs by 20 percent this year.
The company said the move would help reduce operating costs by 20 per cent by the end of 2016 and “follows an extensive internal review of business activities and continued low oil prices.”
Noting that Maersk operates “in a materially changed oil price environment,” chief executive Jakob Thomasen said the pressure is expected to continue in 2016 “and we must remain cost-focused to grow in this market.”
The job cuts at Maersk Oil come just a few days after its parent company issued a profit warning, blaming a downturn in world trade.
Parent company A.P. Møller-Maersk on Friday warned that a weaker market for Maersk Line, the world's largest container shipping company and a global trade bellwether, would weigh on annual profits.
A.P. Møller-Maersk said underlying group profit would be $3.4 billion (3.1 billion euros) this year rather than the previously forecast $4.0 billion, as income from container shipping had been lower than expected.