One-third (34 per cent) of companies from across the global energy sector value chain have either laid off employees or plan job cuts as a result of the impact of Covid-19, according to a poll conducted by human resources consultancy Mercer.
Some 71 per cent of 228 energy companies surveyed said they expect to implement a headcount freeze. The survey was conducted in the last week of April, as oil prices dropped 80 per cent from their peaks in January.
“The drilling industry and the EPC [engineering, procurement and construction] industry … they were not in a good place, they had not even recovered from the previous downturn, and they were just starting again,” said Rob Thissen, energy industry leader for Mercer in the Middle East. The consultancy is a part of US-based professional services group Marsh & McLennan.
“[With this situation], what we have seen is that companies in that sector have cut around 30 per cent of executive pay and 10 to 15 per cent for more junior staff,” he added.
Around 48 per cent of firms have implemented or are planning to freeze pay, while 27 per cent are likely to reduce base pay, Mercer found.
The oil and gas sector has been one of those hit hardest by the coronavirus pandemic, as has aviation and hospitality.
Lockdown measures to prevent the spread of the virus led to airlines grounding their fleet and companies asking staff to work from home. The measures hit demand for petrol and jet fuel, adding to an already oversupplied market where prices for crude plummeted. Some benchmarks, such as West Texas Intermediate – a composite of light, sweet US crude grades – fell below zero to briefly trade at -$40 last month as storage capacity dwindled.
The International Energy Agency, which termed the month Black April, estimated demand shrank by 29 million barrels per day, one-third lower than for the same period last year and the lowest monthly level since 1995.
Meanwhile, oil and gas services companies have taken a hit to earnings as producers cap spending. Baker Hughes wrote down the value of its oil field services business by $1.5 billion (Dh5.5bn) and cut its 2020 spending by 20 per cent.
Globally, oil and gas producers have cut capex by about 30 per cent, according to data compiled by Reuters. Big oil firms have also cut dividends, with Shell forfeiting a payout for the first time since the First World War.
In the Middle East, Saudi Aramco, the biggest oil exporting company in the world, reported a 25 per cent slide in first quarter profit but its dividend policy was unchanged.
Middle Eastern national oil companies are “more or less waiting and seeing” how the market unfolds, said Mr Thissen, "so they haven't implemented any salary reductions as of now”.
The headcount freeze implemented by 71 per cent of companies polled globally is expected to last a long time, he said.
"There is a lot of headcount reduction already here in the region. And so if that's happening, of course, we may hit economic recovery earlier and the companies will start hiring again but in general the expectation is this will last quite a long time and will also mean that the headcount freeze will stay in place for quite a long time.”
Consolidation among energy services companies could define the sector after the pandemic, he said.
"A lot of smaller EPC and oil and gas services companies here in the region and the private services companies will definitely suffer. I would expect bankruptcies and consolidation in that industry for the global players as well as local,” said Mr Thissen.
Youth YouTuber Programme
The programme will be presented over two weeks and will cover the following topics:
- Learning, scripting, storytelling and basic shots
- Master on-camera presence and advanced script writing
- Beating the algorithm and reaching your core audience
UAE currency: the story behind the money in your pockets
EA Sports FC 26
Publisher: EA Sports
Consoles: PC, PlayStation 4/5, Xbox Series X/S
Rating: 3/5
The Outsider
Stephen King, Penguin
Indoor cricket in a nutshell
Indoor Cricket World Cup - Sep 16-20, Insportz, Dubai
16 Indoor cricket matches are 16 overs per side
8 There are eight players per team
9 There have been nine Indoor Cricket World Cups for men. Australia have won every one.
5 Five runs are deducted from the score when a wickets falls
4 Batsmen bat in pairs, facing four overs per partnership
Scoring In indoor cricket, runs are scored by way of both physical and bonus runs. Physical runs are scored by both batsmen completing a run from one crease to the other. Bonus runs are scored when the ball hits a net in different zones, but only when at least one physical run is score.
Zones
A Front net, behind the striker and wicketkeeper: 0 runs
B Side nets, between the striker and halfway down the pitch: 1 run
C Side nets between halfway and the bowlers end: 2 runs
D Back net: 4 runs on the bounce, 6 runs on the full
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
Our legal consultants
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
THE DETAILS
Director: Milan Jhaveri
Producer: Emmay Entertainment and T-Series
Cast: John Abraham, Manoj Bajpayee
Rating: 2/5
What are the GCSE grade equivalents?
- Grade 9 = above an A*
- Grade 8 = between grades A* and A
- Grade 7 = grade A
- Grade 6 = just above a grade B
- Grade 5 = between grades B and C
- Grade 4 = grade C
- Grade 3 = between grades D and E
- Grade 2 = between grades E and F
- Grade 1 = between grades F and G
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The%20specs
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Company%20Profile
%3Cp%3E%3Cstrong%3ECompany%20name%3A%3C%2Fstrong%3E%20myZoi%3Cbr%3E%3Cstrong%3EStarted%3A%3C%2Fstrong%3E%202021%3Cbr%3E%3Cstrong%3EFounders%3A%3C%2Fstrong%3E%20Syed%20Ali%2C%20Christian%20Buchholz%2C%20Shanawaz%20Rouf%2C%20Arsalan%20Siddiqui%2C%20Nabid%20Hassan%3Cbr%3E%3Cstrong%3EBased%3A%3C%2Fstrong%3E%20UAE%3Cbr%3E%3Cstrong%3ENumber%20of%20staff%3A%3C%2Fstrong%3E%2037%3Cbr%3E%3Cstrong%3EInvestment%3A%3C%2Fstrong%3E%20Initial%20undisclosed%20funding%20from%20SC%20Ventures%3B%20second%20round%20of%20funding%20totalling%20%2414%20million%20from%20a%20consortium%20of%20SBI%2C%20a%20Japanese%20VC%20firm%2C%20and%20SC%20Venture%3C%2Fp%3E%0A
THE BIO
Born: Mukalla, Yemen, 1979
Education: UAE University, Al Ain
Family: Married with two daughters: Asayel, 7, and Sara, 6
Favourite piece of music: Horse Dance by Naseer Shamma
Favourite book: Science and geology
Favourite place to travel to: Washington DC
Best advice you’ve ever been given: If you have a dream, you have to believe it, then you will see it.
It
Director: Andres Muschietti
Starring: Bill Skarsgard, Jaeden Lieberher, Sophia Lillis, Chosen Jacobs, Jeremy Ray Taylor
Three stars
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
Available: Now
Race card
6.30pm: Handicap (TB) $68,000 (Dirt) 1,200m
7.05pm: Meydan Cup – Listed Handicap (TB) $88,000 (Turf) 2,810m
7.40pm: UAE 2000 Guineas – Group 3 (TB) $125,000 (D) 1,600m
8.15pm: Firebreak Stakes – Group 3 (TB) $130,000 (D) 1,600m
9.50pm: Meydan Classic – Conditions (TB) $$50,000 (T) 1,400m
9.25pm: Dubai Sprint – Listed Handicap (TB) $88,000 (T) 1,200m
TOURNAMENT INFO
Women’s World Twenty20 Qualifier
Jul 3- 14, in the Netherlands
The top two teams will qualify to play at the World T20 in the West Indies in November
UAE squad
Humaira Tasneem (captain), Chamani Seneviratne, Subha Srinivasan, Neha Sharma, Kavisha Kumari, Judit Cleetus, Chaya Mughal, Roopa Nagraj, Heena Hotchandani, Namita D’Souza, Ishani Senevirathne, Esha Oza, Nisha Ali, Udeni Kuruppuarachchi
Company: Instabug
Founded: 2013
Based: Egypt, Cairo
Sector: IT
Employees: 100
Stage: Series A
Investors: Flat6Labs, Accel, Y Combinator and angel investors
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
