The oil industry has been hammered by falling demand for energy. ©AFP TATYANA MAKEYEVA

Paris (AFP) – Oil services group Schlumberger expects to lay off more than 21,000 employees — a quarter of staff — it said on Friday, also reporting a $3.4 billion quarterly loss.

The Texas-based firm announced a series of charges totalling $3.7 billion, including more than $1.0 billion for severance pay “associated with reducing Schlumberger’s workforce by more than 21,000 employees”.

The firm said that the vast majority of the charge is expected to be paid during the second half of 2020.

Oil producers have been hit hard by the fall in global crude prices as lockdowns adopted to slow the spread of the novel coronavirus hit demand for energy.

In reaction, firms have slashed investment, impacting firms like Schlumberger which carry out many activities related to exploration and the development of oil fields.

“This has probably been the most challenging quarter in past decades,” CEO Olivier Le Peuch said in the earnings statement.

He pointed to a 28 percent drop in revenue from the first to second quarter. The $5.4 billion was 35 percent down from April-June 2019.

“This speaks volumes about an industry confronted with historic oil demand and supply imbalances caused by demand destruction from the global COVID-19 containment effort,” said Le Peuch.

Disclaimer: Validity of the above story is for 7 Days from original date of publishing. Source: AFP.