Shell to cut 11% of its workforce as virus speeds low-carbon shift
Shell does what it needs to do. I see lots of commentaries that this is proof that the oil industry is on a definite and unstoppable downward slide. I beg to differ – Shell has made a lot of very large ticket investment decisions over the last 20 years and while some have been great, they also carry some very expensive duds in their books. Look at Prelude as an example. Even without COVID and even if Asian prices would be double of what they were just before COVID struck it would lose money. It was built for a market that pays steep premiums for LNG – and we are far away from that. Prelude is just a symbol of a larger phenomenon. Majors have been feasting on high commodity prices for too long. They got used to the idea that no matter what a project costs, the market will always take it off their hands. Those bubbles eventually pop. Some majors recent their businesses around what they know, some think that they can beat one deflating bubble only by inflating a bigger one. It’s not oil that goes down, only shoddy management decisions.
www.worldoil.com 
