* BP plans to cut 4,000 jobs in upstream operations
* Cut 600 jobs in North Sea (Updates throughout)
By Dmitry Zhdannikov
LONDON, Jan 12 (Reuters) - British oil and gas company BP announced plans on Tuesday to slash 5 percent of itsglobal workforce in the face of a continued slump in oil prices.
It said it aims to reduce its global oil production, orupstream, headcount by 4,000 to 20,000 as it undergoes a $3.5billion restructuring programme. BP said its headcount totalledaround 80,000 at the end of 2015.
With crude oil prices at 12-year lows of around $32 abarrel, the world's biggest oil and gas producers are set tocontinue aggressively slashing spending this year as they facetheir longest period of investment cuts in decades.
"We want to simplify (our) structure and reduce costswithout compromising safety. Globally, we expect the headcountin upstream to be below 20,000 by the end of the year," acompany spokesman said.
In the North Sea, he said BP planned to reduce headcount by600 people over the next two years with most cuts likely in2016.
BP shares, which have fallen by around 40 percent since theoil price began to slide in mid-2014, were up 1.2 percent at1157 GMT compared with a 0.8 percent rise for the broader sectorindex.
Oil companies including Royal Dutch Shell andChevron have already slashed tens of thousands jobsglobally to deal with a near 75 percent drop in oil prices sinceJune 2014 that has seen earnings collapse.
BP, which must also pay $20 billion in fines to resolve thedeadly 2010 Gulf of Mexico spill, announced in October plans fora third round of spending cuts and said it would limit capitalspending, or capex, to $17-19 billion a year through to 2017.
The company, which has already sold over $50 billion ofassets in recent years in order to cover the spill costs, saidit expected an additional $3-5 billion of divestments in2016.
Fourth-quarter upstream earnings for oil majors are expectedto fall by 84 percent from a year earlier and 48 percent fromthe previous quarter, according to analysts at Macquarie.
BP will report fourth quarter and full-year results for 2015on Feb. 2. (Reporting by Dmitry Zhdannikov; Editing by Jason Neely andSusan Fenton)