BP To Freeze Wages As Crude Price Plunges

(RTTNews) - British oil giant BP plc (BP.L, BP) will freeze employees pay in 2015, in order to control costs amid plunging crude oil prices, according to media reports.

Reports say Chief Executive Bob Dudley announced the freeze in an internal memo to employees on January 26. Dudley said that the company requires to implement steps to overcome the "harsh trading environment."

"One of the measures we are taking is a general freeze to base pay for 2015, with only a few exceptions," he said.

"Together, with the work we are doing to simplify and increase efficiency throughout BP, we see this as a prudent response to the currently challenging market environment in which BP operates," the memo said.

As of December 2013, BP employs 83,900, with about 19,800 in the U.S. and Canada. BP is scheduled to release 2014 fourth-quarter and annual earnings report on February 3.

Oil has plunged below $50 per barrel mark, a more than 50 percent drop compared to crude oil prices six months ago. Almost every major oil producers have postponed their new projects, enforced job cuts and continue to seek new avenues to cut costs. Concerns over a supply glut continue to plague markets after the OPEC decided not to lower its oil production.

In October 2013, BP announced plans to divest a further $10 billion of assets before the end of 2015, having completed its earlier divestment program of $38 billion in 2012. BP has agreed to around $4 billion of such further divestments as of end October 2014.

BP is currently trading at $39.99, up $0.07 or 0.18%, on the NYSE.