Shell Plc, one of the world’s largest oil and gas companies, is preparing to cut around 20% of its workforce in specific divisions as part of a broader effort to streamline operations and enhance profitability. This latest move reflects the ongoing strategy of Shell’s Chief Executive Officer, Wael Sawan, to increase efficiency across the company’s global operations.
The planned job reductions will affect Shell’s exploration, strategy and portfolio segment, as well as its development, subsurface, and wells business. According to a source familiar with the matter, the cuts are part of a series of measures aimed at simplifying the company’s operations and reducing costs.
These proposed job cuts are pending discussions with employee representative groups, and they follow earlier reductions in other areas of the company. Previously, Shell had made similar workforce cuts in its deal-making team, low-carbon solutions, chemicals, and offshore wind operations.
CEO Wael Sawan, who took over the reins of Shell earlier this year, has been focusing on restructuring the company to adapt to the changing energy landscape. In recent years, Shell has been under pressure to balance its traditional oil and gas business with its growing investments in renewable energy. However, the company has faced challenges in making its low-carbon ventures as profitable as its core oil and gas operations.
Sawan’s strategy emphasises cost-cutting and operational efficiency, which have become increasingly important as the company navigates a volatile energy market. The recent slump in oil prices, combined with rising costs in the renewable sector, has forced major energy companies like Shell to reconsider their workforce and operational structures.
The proposed job cuts are expected to significantly impact Shell’s operations, particularly in its exploration and development divisions. These areas have traditionally been central to the company’s success in discovering and developing new oil and gas resources. However, with the global shift towards cleaner energy and the increasing financial pressures on fossil fuel companies, Shell is rethinking its approach to exploration and development.
The planned workforce reductions are part of a broader restructuring effort that Shell has been pursuing under Sawan’s leadership. Earlier this year, the company announced plans to cut jobs in its low-carbon solutions and offshore wind operations, citing the need to focus on profitability and operational efficiency.
Shell’s job cuts come at a time when the global energy market is undergoing significant changes. The transition to renewable energy sources is accelerating, driven by government policies, technological advancements, and increasing public awareness of climate change. At the same time, traditional oil and gas companies are facing mounting financial pressures due to fluctuating oil prices, rising operational costs, and the need to invest in new technologies.
For Shell, these challenges have been compounded by the need to manage its diverse portfolio of energy assets, which includes both conventional oil and gas operations and emerging renewable energy projects. The company has been investing heavily in renewable energy, including offshore wind, solar power, and hydrogen, but these ventures have yet to generate the same level of returns as its oil and gas business.
CEO Wael Sawan has emphasised the importance of performance and discipline in achieving these goals. “We are committed to delivering value for our shareholders while reducing our carbon emissions and contributing to the global energy transition,” he said in a recent statement.
