Saudi Aramco, the biggest oil exporter and the most profitable company in the world has started terminating hundreds of employees pursuing their cost-cutting measures.
This week the Saudi Aramco issued termination notices to several hundred employees in different divisions of the company. Most of the terminated employees are expatriates.
There are around 80,000 employees in the Saudi Aramco company. The cost-cutting measures have been taken in the company due to the reduction of the oil price.
Aramco is not the only oil company to layoff its employees during the pandemic. At the beginning of June 2020, BP announced to slash 10,000 jobs i.e. 15% of its workforce.
Saudi Aramco Profitability
Saudi Aramco posted a net profit of $16.66 billion in the first quarter of 2020 as compared to $22.2 billion a year earlier.
The Brent Crude which used to be traded at $64 before the Coronavirus lockdown, touched $15 at some time and now has recovered to $41. However, it is still 36% below the pre-corona price.
Capital Budget Reduction
The company has already announced to slash its capital expenditures by $25 to $30 billion this year. However, they remained committed to the payment of a $75 billion dollars dividend.