As its fortunes dwindled due to falling oil prices, Royal Dutch Shell Plc is to sack 10,000 people in an effort to bolster margins.

Shell’s drive to improve competitive performance is delivering at the bottom line. Operating costs have reduced by $4 billion, or around 10 per cent in 2015, and the company expects Shell’s costs to fall again in 2016 by a further $3 billion.

Synergies from the BG combination will be in addition to that. Together, these actions will include a reduction of some 10,000 staff and direct contractor positions in 2015-16 across both companies, as streamlining and integration of the two companies continue.

When Shell announces its results on 4 February 2016, Shell’s fourth quarter 2015 earnings on a current cost of supplies (“CCS”) basis excluding identified items are expected to be in the region of $1.6–1.9 billion.
This includes Upstream of $0.4–0.5 billion, of which Integrated Gas some $1.6–1.9 billion, and Downstream of $1.4–1.6 billion, of which oil products some $1.3–1.4 billion and chemicals some $0.1–0.2 billion. Full year 2015 earnings on a CCS basis excluding identified items are expected to be in the region of $10.4 – 10.7 billion.

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