March 2020 witnessed over 51,000 people losing their jobs in the auxiliary businesses associated with the oil industry, in the US, such as those involved in construction, shipping and manufacturing of drilling equipment.
Oil and gas companies are expected to lay off about 30 per cent of their workforces in the first quarter of 2020.
Studies have revealed that the adverse impact on jobs has resulted from the sharp dip in global demand due to the lockdown and also because of the sharp decrease in prices. The oil-price war between Russia and Saudi Arabia has led to excess supply, leading to a dramatic fall in prices in the last one month.
About 51,000 drilling and refining employees had to be laid off in March alone, and there seems to be no relaxation in sight this month either, with oil prices plunging.
According to data from the US Department of Labour and surveys by research firm, BW Research Partnership of about 30,000 energy companies, job growth has been set back by at least five years.
With economic activities being reduced to zero, across the world, there has hardly been any demand for energy. Every time a rig or fracking team gets is dissolved, more than 20 associated field workers also lose their jobs. Oilfield servicers have seen the maximum impact. Approximately 20 companies work at each well site. With the explorers owning these wells nearing bankruptcy, the effect is felt by everyone in the supply chain.
