The Chief Executive Officer of ExxonMobil warned on Wednesday of the possibility of job cuts due to the unprecedented impact of the pandemic on the oil industry.
“These are difficult times. We are making tough decisions, some of which will result in friends and colleagues leaving the company,” Darren Woods said in an e-mail message to employees following a meeting with them to discuss the current state of the oil and gas industry.
“We know that the industry impact of the pandemic is unprecedented. Reduced demand was roughly five times the decline seen with the 2008 financial crisis,” Woods explained, adding that although the situation is temporary, the pace of recovery is uncertain.
Lauding “excellent operating results” despite the unprecedented demand destruction, Woods reiterated the necessity of staying nimble in response to evolving market conditions.
-Significant investments needed
Woods said ExxonMobil estimates that global oil demand will grow by 0.6% a year and gas demand by 1.3%.
Therefore, he deduced that new oil production has to increase by nearly 8% per year and natural gas by 6% taking into account depletion rates.
Recalling the International Energy Agency’s (IEA) estimate that between $12 trillion and $17 trillion of additional industry investments are needed by 2040, Woods stressed that under any demand scenario, depletion supports the need for significant investments.
By Sibel Morrow