NEW YORK (AFP) ― Oilfield services company Baker Hughes said Tuesday it would cut 7,000 jobs in the coming months in response to a sharp downturn in exploration activities following the oil price crash.

One of the three top oilfield services firms, Baker Hughes said the cuts, amounting to about 11 percent of its worldwide staff, would come mostly in the first quarter of this year.

The move will cost the company upfront about $160 million-$185 million in severance charges, but aims to cut costs over the medium term as the overall industry contracts in response to the more than 50 percent fall in oil prices in the past seven months.

Baker Hughes is also reducing capital expenditures by 20 percent.

“This industry can’t simply hope and wait for oil to climb back over $100 a barrel. Instead we must adapt to a new reality of sustained lower commodity prices,” Martin Hughes, the chairman and chief executive, told analysts in a conference call.

Last week oil services industry leader Schlumberger said it would cut 9,000 jobs, about 7.5 percent of its global workforce, due to plunging oil prices that have forced petroleum companies to cut drilling budgets.

And last month Halliburton, the number-two oil services provider, said it would lay off 1,000 people, 1.25 percent of its work force, to deal with the market changes.