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Job losses at BP and Honda in cuts drive

JOBS are facing pressure as oil giant BP signalled plans to delay or axe projects and fears emerged over the UK business of car maker Honda.

BP is reducing staff in exploration and production, refining and backoffice operations as the price of a barrel of Brent crude oil slumped to below $70 a barrel from highs above $100. Analysts have warned oil industry jobs will face a threat as Middle East oil sheikhs and US shale oil barons battle for dominance of the global energy industry.

BP, which has 84,000 staff, said it was launching a "simplification plan" that may involve delaying or ditching some schemes as it tries to adjust its strategy to the lower oil price.

Finance chief Brian Gilvary told a Sunday newspaper: "We have flexibility in our programme to trim into next year if that's what we need in a new world of oil at $70 or $60."

The company is already facing a multi–billion dollar bill from legal action over the fatal Deepwater Horizon rig blow–out in the Gulf of Mexico in 2010.

While plummeting prices spell misery for oil majors and contractors that supply them, motorists have benefited as forecourt fuel prices drop. Economists predict further falls in crude prices after Opec failed to boost production at a meeting last month.

The cartel hopes lower prices will force higher–cost US shale producers to reduce output in a game of brinkmanship.

But experts say a similar stand–off in the late 1980s simply prompted oil companies to put off exploration projects, sparking longer–term supply shortages. Meanwhile it has emerged that the UK plant of Japanese car maker Honda has cut production and jobs amid lacklustre demand.

The group's Swindon plant is said to have made a profit of just £1million on sales of £2billion in the year to the end of March after cars sold fell a fifth to 133,600.

Honda is understood to have slashed manufacturing capacity at Swindon to about 150,000 cars a year from about 250,000. It closed one of its two production lines with the loss of about 500 jobs, leaving it with 3,000 staff.

Production is said to be likely to dip to about 115,000 a year.

Swindon makes models including the Jazz, Civic, Civic Tourer and the CR–V sports utility vehicle.

Senior vice–president of Honda Motor Europe, Ian Howells, said: "Honda remains absolutely committed to producing cars at Swindon for the long–term.

"We are also preparing to start producing new variants of the Civic and CR–V, production of which will start in January 2015. In mid–2015 we will start production of the long–awaited Civic Type R."

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