Oil company BP cutting 4,000 jobs by end of 2017

Oil company BP is cutting some 4,000 jobs in exploration and production over the next two years amid sharp drops in the price of crude.

The cuts in BP's upstream business globally will include the loss of some 600 jobs in the North Sea.

The cost-cutting announced Tuesday comes as the price of oil dropped to a 12 year-low near $31 US a barrel. Part of the decline is due to concern over a drop in demand in China, which is depressing commodity prices worldwide.

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Company officials began notifying employees of the action in town hall meetings in Scotland.

Mark Thomas, regional president for BP North Sea, says in a statement that because of toughening market conditions "we need to take specific steps to ensure our business remains competitive and robust."

Other companies slash jobs, postpone projects

Companies like BP are slimming down to cope with the slump in oil, which is not expected to recover significantly for months, possibly years. California-based Chevron said last fall that it would eliminate 7,000 jobs, while rival Shell announced 6,500 layoffs.

It's not even the big producers that will be affected most, but the numerous companies that do business with them, such as drilling contractors and equipment suppliers.

While plummeting oil prices have been great news for motorists, airlines and other businesses that rely heavily on fuel, some 95,000 jobs were lost in the energy sector by U.S.-based companies in 2015, according to the consulting firm Challenger, Gray & Christmas. That was up from 14,000 the year before.