Customers have dwindled by the week at Indian Masala Hut, a curry stall in Singapore’s shipyard heartland. Manager K. Muralidoss blames the slump in oil rig-building that led to the elimination of thousands of jobs, many held by workers from India and Bangladesh.
“The lunchtime crowd has more than halved,” Muralidoss says, surveying the almost-empty Benoi Road food court, where only four of 12 hawker stalls were open one afternoon last week. As recently as September, he was busy filling orders from companies trying to sate hungry laborers working overtime. “That has come down quite a bit because there are fewer projects being worked on.”
More than $400 billion of proposed energy projects worldwide have been delayed since mid-2014 and pushed into 2017 and beyond, according to consulting firm Wood Mackenzie Ltd. In Singapore, the global center for oil-rig construction for decades, the slowdown contributed to the economy contracting the most in four years in the third quarter.
BP Plc abandoned oil exploration off the Great Australian Bight, it said last week, five years after beginning a search for resources in one of the world’s last frontier regions. BP had previously estimated the drilling program would cost more than A$1 billion ($769 million).
Decisions like this ripple through Singapore’s oil and gas services industry, from Keppel Corp. and Sembcorp Marine Ltd., the world’s biggest builders of oil rigs, to companies supplying anchors, chains and other components, to the eateries feeding an offshore engineering workforce that tripled over a decade to peak at more than 90,000.