U.S. oil field service giant Baker Hughes announces layoffs as oil prices plunge

Baker Hughes, the third biggest oil field service company in the world, announced on Tuesday that the company would cut 7,000 jobs mostly in the first quarter of this year, about 11 percent reduction to the 62,000-plus employees it employs globally.

The Houston-based company made the announcement just after it reported a net income of an adjusted 629 million U.S. dollars for the three months ending Dec. 30.

Announcing the layoffs, Baker Hughes Chairman and Chief Executive Officer (CEO) Martin Craighead said this was the industry, and it was throwing the company another one of these downturns, and they were going to be good stewards of their business and do the right thing. But these were never decisions that were done mechanically.

"This is really the crappy part of the job, and this is what I hate about this industry frankly," Craighead said.

The company expects to book a one-time charge in the next period in the range of 160 million U.S. dollars to 185 million U.S. dollars for severance, Baker Hughes said, adding that it was reviewing its facilities for possible closures.

The company said its net income rose to 1.71 billion U.S. dollars in 2014 from 1.1 billion U.S. dollars in 2013.

Bake Hughes is the latest one to announce the job cuts in a wave of layoffs by energy giants like Halliburton and Schlumberger Ltd as a result of falling oil prices since June last year.

Halliburton, based in Houston and the second biggest oil field service company, also announced in December last year that it would lay off 1,000 employees outside the U.S. As the world's biggest oilfield service company, Schlumberger, which has headquarters in Houston and Paris, announced recently to cut 9,000 employees globally to tackled the "uncertain environment" of plummeting crude prices.

Currently, Baker Hughes operates in over 90 countries and regions, providing the oil and gas industry with products and services for drilling, formation evaluation, completion, production and reservoir consulting. In November 2014, Baker Hughes said it had entered talks with Halliburton over a merger deal valued at 34.6 billion U.S. dollars. If carried out, it would be the largest merger in the history of the industry. Endite