With the price of oil in the region of USD 60 a barrel and OPEC (Organisation of the Petroleum Exporting Countries), the producers’ cartel, underlining the looming supply glut facing oil markets, the prospects for jobs in the industry are at their worst for some time. It comes amid surging US shale output and weakening global demand.

Sir Ian Wood, an adviser to the British government, predicted that the lower oil price would have huge ramifications around the world, and could lead to a wave of job losses at North Sea oil fields over the next 18 months. The US-based oil company ConocoPhillips has already moved to cut 230 out of 1,650 jobs in the UK and some analysts predict that other large firms will make similar cost-cutting announcements in the coming months. BP plc has announced a sweeping cost-cutting programme that will lead to USD1bn in restructuring charges over the coming year and the loss of several thousand jobs across the group

Chevron Corp. said recently that it has put plans to drill for oil in the Canadian Arctic on indefinite hold, citing “economic uncertainty in the industry.” Houston-based Marathon Oil Corp. announced it will spend 20 percent less next year on oil exploration and production due to “the continuing dynamic change in crude oil markets.”

Oil and gas companies will make decisions on 800 projects worth USD500 billion next year, Lars Eirik Nicolaisen, a partner at Oslo-based Rystad Energy, told Bloomberg News. If oil prices average USD70 a barrel in 2015, energy firms could pull USD150 billion or 30%, of projected investment from exploration projects worldwide, he said.

Over the next decade, low oil prices could put almost USD1 trillion in future projects at risk, a Goldman Sachs analysis found earlier this month, which would have a huge impact on jobs in the sector. The investment bank studied 400 of the world’s largest new oil and gas fields. It found that more than two-thirds of projects are unprofitable with oil at USD70 a barrel.

The IMF (International Monetary Fund) noted yesterday that some African countries are among the most at risk from the fall in oil prices because of their degree of dependence on oil exports. Oil exports account for 40-50 percent of GDP for Gabon, Angola and the Republic of the Congo, and 80 percent for Equatorial Guinea. Similarly, Angola, Republic of Congo and Equatorial Guinea, oil also accounts for 75 percent of government revenues. The economic effects of falling oil prices can increase political risk, especially in conflict countries like South Sudan and the Central African Republic, which are unlikely to see exploration activities and the consequent increase in job opportunities with prices so low.