French oil major Total to cut spending due to low oil prices

Total plans to cut its investment programme in all segments by about 20%, its chief executive tells staff

Russia and Saudi Arabia to cut oil production of at least 10 million barrels, according to a tweet by US President Donald Trump on Thursday. Reuters

French oil major Total will freeze recruitment, boost costs savings and halt its share buyback programme due to tumbling oil prices, chief executive Patrick Pouyanne told staff in a video message on Thursday, according to a union official.

The group is the latest oil and gas producer to slash investment plans and cut costs following a slide in oil prices to 20-year lows, and a slowdown in global demand linked to the coronavirus.

A Total representative was not immediately available to comment.

Total plans to cut its investment programme in all segments by about 20 per cent and find additional costs savings of around $400 million (Dh1.4 billion) this year, Mr Pouyanne said in the video message, CGT union delegate Thierry Defresne told Reuters.

The group had planned around $18bn of net investments in 2020 and to buy back around $2bn worth of shares.

Mr Defresne, who watched the video, said Mr Pouyanne confirmed the share buyback programme will be halted.

He said Mr Pouyanne told staff that there was a $9bn hole to be plugged and the measures taken will cover around $5.5bn. He said Total intended to borrow to cover the remaining shortfall.