O&G players worldwide cutting costs amid triple-threat
PETALING JAYA : The oil and gas industry, once stable and resistant to change, is now under intense pressure to rethink how it operates. Shifting global demand, ongoing political conflicts and volatile commodity markets are forcing the sector to adapt like never before.
Recently, major international corporations such as Shell, BP and Chevron have undertaken comprehensive operational restructuring, including significant workforce reductions.
Investment strategies are being reshaped by the triple-threat of rising operational expenses, tougher environmental regulations, and the substantial cost of adopting advanced technologies—resulting in significant adjustments to workforce size and structure.
Out-of-commission oil fields
Operating costs have risen, especially in upstream exploration and production. With the easier- to-reach resources fast depleting, oil companies must now tap into the more difficult reserves like sour gas and deepwater projects, which require higher investment.
As a result, oil companies have begun re-evaluating their corporate investment plans, with a projected 6% decline in upstream oil investment projected in 2025—the first year-on-year reduction since 2020.
Oil companies are struggling as drilling costs rise and price forecasts weaken. Active rigs are drilling at significantly lower levels slowing upstream activity. With oil prices hovering around US$63 per barrel, shrinking profit margins are forcing firms to delay or cancel projects.
Earlier this year, ConocoPhillips exited its joint-venture with Petronas in the US$3.3 billion (RM13.7 billion) Salam-Patawali deepwater oil and gas project, first discovered in 2018. The company has also announced plans to shrink its global workforce by end-2025.
They are also reportedly eyeing the sale of assets in the Permian Basin worth over US$1 billion (RM4.2 billion).
They are not the only ones.
US-based Chevron plans to cut 15% to 20% of its global workforce, potentially impacting 6,000 to 8,000 employees, over the next year. Meanwhile, ExxonMobil will release nearly 400 workers in 2026 following its merger with Pioneer Natural Resources.
BP, based in the UK, is in the midst of plans to eliminate 4,700 jobs and 3,000 contractor positions by 2026 as part of a US$2 billion cost-cutting drive.
In the UK's North Sea, Spain's Repsol is also looking to shrink its workforce through field decommissioning, potentially impacting 2,000 jobs.
These layoffs reflect a broader industry trend of adapting to economic uncertainties, declining output from maturing fields, and the increasing focus on cost optimisation and energy transition.
Impact of green regulations
Adherence to environmental compliance is also becoming increasingly capital-intensive.
More stringent global regulations concerning carbon emissions, flaring and methane management are obliging companies to allocate significant investment toward monitoring systems, equipment upgrades and cleaner processes.
This includes a growing focus on Carbon Capture, Utilisation and Storage (CCUS) projects, which are projected to experience a tenfold increase in investment by 2027.
Non-compliance with these evolving environmental, social and governance (ESG) criteria pose significant business risks, such as limited access to funding and reputational damage. To manage these rising obligations, many entities are streamlining their workforces in high-carbon divisions.
Heavy upfront costs
Companies are investing more in advanced technologies like automation, artificial intelligence (AI) for data analysis and compliance, and monitoring systems powered by the Internet of Things (IoT) to improve efficiency and meet regulatory demands.
While these technological upgrades may yield long-term cost reductions, their implementation necessitates substantial upfront capital expenditure, such as modernising rigs with automation capabilities or deploying sophisticated AI-driven monitoring systems.
Widespread adoption of AI alone could potentially lead to cost savings ranging from 10% to 20% by 2025.
This shift toward technology-driven models is streamlining operations, replacing traditional roles with automated solutions, and consolidating functions to boost productivity and financial stability—rather than simply expanding existing setups.
Prominent industry participants such as Exxon and Chevron are focussing production growth in more efficient regions like the Permian basin, leveraging consolidation and technology-driven improvements to manage costs amid declining upstream investment.
Petronas, for its part, is focusing on innovation, sustainability and human capital development to support Malaysia's net-zero journey.This commitment involves not only accelerating investments in renewable energy and advanced low-carbon technologies, but also cultivating a forward-thinking workforce equipped to tackle the dynamic challenges of the global energy landscape.
By nurturing talent, fostering a collaborative culture, and prioritising digital transformation, Petronas aims to drive meaningful progress towards environmental goals while securing long-term business growth. Enhanced partnerships, research initiatives, and community engagement will be central to this strategy, positioning the company as a leader in sustainable energy and responsible corporate stewardship for Malaysia's future.
Where do we go from here?
The overarching imperative is clear: oil and gas companies are re-conceptualising business practices to better navigate current cost pressures and align with future energy demands.
Strategic actions are already evident at major international corporations like BP, Shell and Chevron. These are not merely reactive measures to short-term market changes, but critical strategic decisions made to ensure that the energy industry remains future-ready.
This trajectory implies a reduction in traditional employment opportunities within the short term. However, that is on account of the evolution of industry operations, not a disappearance of energy demand.
Industry experts expect jobs to re-emerge in greener fields, including CCUS-management projects, within the next two to three years, once cost savings are realised.
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Malay Mail
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FooTori doesn't chicken out on serving excellent ‘yakitori' in Kelana Jaya
PETALING JAYA, July 20 — In the last decade, the canon of Japanese food in the Klang Valley has grown from simple sushi and ramen places to include specialist tempura, soba and yakiniku restaurants, all executed with notable attention to detail. Even ramen has taken on a new polish, with focused, tightly curated shops emerging across the city. The most dramatic shift? The explosion of small, exclusive omakase-style sushi counters in the past five years, now seemingly everywhere, each offering its own take on refined, theatrical morsels of fish and rice, all for a couple hundred ringgit a pop. But one constant has been the izakaya scene. The allure of ice-cold, crisp Japanese beer, salty snacks and cheap skewers of grilled chicken has always sat well with the Klang Valley palate, with yakitori in particular gaining a strong following. For a while, any loud, rowdy izakaya was the place to find it, aside from longstanding yakitori specialists like Sumi-Ka in SS15 Subang Jaya. But just as ramen and sushi have been given the refined, polished treatment, yakitori is now starting to get the same. FooTori from the front. — Picture by Ethan Lau FooTori, which opened in Plaza Kelana Jaya in May, may not appear to be the epitome of sophistication at first glance. The central grilling area, framed by concrete and glass, feels more like a zoo exhibit than a grand stage for chefs. The rest of the furnishing is similarly austere. Grey exposed concrete features throughout, though it leans less towards industrial chic and more towards 'unfinished' chic. Still, some aspects have clearly been thought through. The air stays remarkably clear, without a hint of smoke. When we left, our clothes didn't carry any lingering scent, and the ventilation system manages all this without a horrid din. Being located in a commercial development as stark as this one probably doesn't help that perception. Three's company: sansho pepper, salt and pepper, and 'shichimi togarashi'. — Picture by Ethan Lau But this is the second restaurant by Chef Foo, formerly of Hinoiri in Bukit Jalil, who has already made this location work for his flagship, Sushi Foo, which is located just a few doors away. Foo spent close to 30 years working in Tokyo, and though he's known mostly for a sincere yet skilled take on sushi, he now intends to bring that same approach to yakitori. FooTori offers three levels of omakase: RM98 for eight skewers, four appetisers and a dessert; RM118 for 10 skewers; and RM138 for 12. It's a helpful introduction for those unfamiliar with the many different parts of a chicken. But for those already in the know, the à la carte menu is full of gems, if you know where to look. 'Kawa' or chicken skin, and 'sasami' or filet. — Picture by Ethan Lau Kawa, or chicken skin (RM6), is a delightful bite, shatteringly crisp and gleefully greasy. But it's the sasami, or filet (RM8), that shows there is more to the cooking here than meets the eye. When a cook places the stick in front of me, he explains that each piece of ghostly white meat is deliberately cooked to 'just done'. The centre is slightly pink, and it is undeniably on the rare side for chicken. He stresses the freshness of the bird being used, though he's happy to cook it further if I prefer. The chicken is still pink on the inside of the 'sasami'. — Picture by Ethan Lau On top of each piece is a daub of wasabi. It's a meaty, tender mouthful, and simply unlike any piece of white meat you will ever experience. I put my trust in the kitchen that night, just as I did nearly a decade ago at Yakitori Masakichi in Tokyo, which had been featured on Netflix's Ugly Delicious. That was the first time I encountered chicken prepared this way, down to the same presentation with the dabs of wasabi and the chicken grilled to medium rare. It was monumental for me then, and it is deeply satisfying for me now to see this becoming more common in the Klang Valley. Hopefully, it points to a shift in how diners approach and appreciate yakitori. Other parts may not require quite the same amount of guts to tackle, but they are no less impressive. 'Momo' or thigh, a second order of 'kawa', and 'obi' or inner thigh. — Picture by Ethan Lau Fans of dark meat will enjoy the momo, or thigh (RM6), and obi, or inner thigh (RM10), each offering a different expression of chicken at its most juicy and bouncy. Bonjiri, or tail (RM8), is essentially the butt, and while it has the potential to taste off, it's been prepared well here, retaining just enough fat for flavour and cartilage for crunch. On the topic of cartilage, the nankotsu or soft bone (RM6) is the ultimate stick for texture. 'Nankotsu' or soft bone and 'leba' or liver. — Picture by Ethan Lau Crunchy, snappy and perfect for dipping into the sansho pepper, salt or shichimi togarashi mix, cuts like this are what make yakitori such a good match for guzzling down pints of cold beer. It would be remiss not to mention the lush leba, or liver (RM8). Grilled with just a small hint of sweet tare, it avoids the unpleasant metallic notes of iron and leaves only a rich, creamy texture to enjoy. A calling card for any 'yakitori' place is the 'tsukune' or meatball. — Picture by Ethan Lau And finally, no yakitori place can be taken seriously without considering its tsukune, or meatball (RM6). FooTori's is tightly packed, with a slight crust from the caramelisation of the tare on the outside, and is a dream to dip and swirl through the raw egg yolk and sweet, salty tare mixture. At a glance, FooTori probably looks unassuming as all get out. A closer look reveals an attention to detail that belies its decor, and a mastery of preparation and technique that can only come from experience, something Foo, an older man who's done his time, wears plainly. But that's the whole idea: a simple, unpretentious set-up, from which he serves excellence. At a time when yakitori is starting to stretch beyond cheap, by-the-numbers izakaya food, FooTori arrives to stake its claim, particularly by not chickening out from serving 'rare' chicken. If this is where things are headed, I'm all for it. FooTori ぷ鸟 B-08-1, Plaza Kelana Jaya, Jalan SS 7/13A, Petaling Jaya, Selangor. Open Tuesday to Sunday, 5pm-12am Tel: 010-256 2279 Instagram: @foo_tori * This is an independent review where the writer paid for the meal. * Follow us on Instagram @eatdrinkmm for more food gems. * Follow Ethan Lau on Instagram @eatenlau for more musings on food and mildly self-deprecating attempts at humour.
