Nearly 100,000 American oil company employees—now former—have lost their jobs in the last 18 months due to oil prices falling to extreme lows and American energy companies losing ground internationally. Globally, almost 200,000 positions within the petroleum industry have been eliminated during this timespan.
As crude oil prices worldwide drop following increased production by Saudi Arabian companies, stateside corporations are finding themselves unable to stay afloat. Cost cutting, mostly by way of layoffs, has been occurring this year at a rate nearly ten times that of what it was at this time last year.
Schlumberger, Baker Hughes and Halliburton layoffs make up nearly half of the total job loss within the industry.
Those oil service providers have been hit harder than exploration and production businesses, although the latter companies are experiencing severe losses in profit as well.
ConocoPhillips is in the process of eliminating nearly 2,000 positions from their operations, while Oklahoma City-based energy group Chesapeake recently slashed 740 jobs, 15 percent of their workforce.
“Big Oil” companies like BP, Chevron, Shell and ExxonMobil have already begun making small cuts in their employed numbers and are expected to make deeper cuts in 2016.
Less sizable organizations like Pioneer Oil Co. and Swift Resources are being hit even harder by forced operational cuts. Also experiencing setbacks in anticipated financial earnings are companies in fields related to the oil industry, such as construction, utilities and metals production: Caterpillar, General Electric and US Steel have all made cuts in line with plummeting oil costs.
The most significantly affected portion of the oil industry is by and far the oilfield sector, followed by contractors who provide drilling rigs to those extraction companies. Cuts made at production companies, refineries and pipeline operators have not been quite as severe.
Large-equipment makers and suppliers have seen slipping success as well. Their customers, primarily oil companies, are unable to purchase new tools.
In addition to having direct negative effects on various components of the energy industry, the fall in oil prices has generated ripples of damaging economic impact in local communities.
Especially in towns which previously thrived on provisioning oil companies with supplies like fracking sand, liners for truck beds or safety equipment for drilling rigs, citizens may be benefitting from low gas prices at the pump but are still suffering overall because of lower economic prosperity overall.
Hiring rates have fallen as well during this industry downturn, resulting in fewer job opportunities for graduates of petroleum engineering programs nationwide. Many who entered college just a few years ago when the industry was at a relative high were expecting immediate employment and hefty paychecks upon graduation, but such is not the case in today’s climate.
Even attaining an oilfield job on a drilling rig is significantly more difficult now than it was just a few short years ago because so many massive oil companies are having to scrap projects and planned undertakings.
Aiming for jobs in the research and discovery sector of the oil industry or pursuing a master’s degree to temporarily stave off the effects of unemployment are likely the best options for many petroleum engineering students as of now.