Shell faces extensive job cuts in its core oil and gas exploration business, as confirmed by a person familiar with the plans. Around 20 percent of jobs in the departments responsible for exploration strategy and the development of new oil and gas deposits are to be eliminated.

The heading translates to English as:
"Primarily affected are technical professionals such as geologists, geophysicists, and engineers responsible for drilling planning. Some of the cuts result from the merger of technical departments that were previously located in different areas of the company. The plans are currently under negotiation with the employees and are not yet final, the source added. The news of the impending layoffs was first reported by Reuters.

Wael Sawan, who took over the leadership of Shell last year, announced plans to reduce the company's operating costs by up to $3 billion by the end of 2025. In 2023, operating expenses amounted to $40 billion. Since then, Sawan has already made job cuts in various areas of Shell, including renewable energy. In early August, he announced that he had so far achieved savings of $1.7 billion and intended to further streamline the organization.

Sawan emphasized that he would continue to consolidate management positions and increasingly replace administrative tasks with technology, without explicitly mentioning the core business of oil and gas extraction.

Shell argues that exploration is crucial for replacing depleted resources and discovering profitable new fields. "What we don't know is whether these cuts indicate that Shell is 20 percent overstaffed or whether this suggests a potential reduction in the portfolio," said Irene Himona, an analyst at Bernstein. She added that production costs in Shell's upstream sector are above the industry average. "It seems that they are looking to increase efficiency," Himona continued.

The shares of Shell have risen by more than 8 percent so far this year, outperforming the competition as investors positively evaluate Sawan's focus on operational activities and the consistency of distributions to shareholders.