“We don’t create demand, we meet demand.”
That’s how Mike Wirth, the chief executive of Chevron, describes the way his company works. So long as the world is using oil and gas, Chevron and others have a responsibility to provide those fuels affordably and reliably, he said, “because it advances human progress.”
Chevron, the second-largest oil company in the United States behind Exxon, pumped a record amount of oil and gas last quarter, about 3.4 million barrels a day. President Trump has promised to make it easier for oil companies to get permits for even more drilling. Chevron also recently completed a $53 billion acquisition of Hess after prevailing in a protracted legal battle with its rival Exxon.
But not all is well. The International Energy Agency has predicted that global demand for oil and gas could peak by the end of the decade. Oil prices have fallen as plentiful supplies meet weaker demand, in part because of the economic turmoil generated by Mr. Trump’s trade war. Chevron’s profits have drifted downward along with oil prices, which many analysts expect will continue falling.
Mr. Wirth, who joined Chevron more than 40 years ago and has led the company since 2018, is making changes that he says will set the company up for the future. Last year, he moved Chevron’s headquarters to oil-rich Texas from California, where it was based since its founding in the 1870s. This year, the company announced it would lay off up to 20 percent of its work force, or around 9,000 people, by the end of 2026.
And while the Trump administration has embraced fossil fuels and sidelined climate efforts, oil companies like Chevron still must consider the long-term effects of their operations and their relevance as renewable energy advances and countries push to electrify their economies.
“There are trade-offs, there is judgment involved and there are competing societal priorities and interests,” Mr. Wirth, 64, said.
This interview was edited and condensed for clarity.
The International Energy Agency has said that oil demand will soon peak, and prices have been sliding. What is the long-term investment case for Chevron?
First of all, the I.E.A. has not always been right, historically, on things, and it wouldn’t be surprising if the I.E.A. is not right about this.
Even if they are, once oil demand reaches a level where it’s no longer growing, it’s unlikely to drop off quickly. It’s more likely to stay at a plateau.
So demand is going to be around for a long, long time. Oil production is what’s known as a depletion business. As we produce barrels, they can’t be produced again. You have to invest in new supply, even if demand’s not growing.
We are investing in new technologies, like hydrogen, carbon capture and storage, lithium and renewable fuels. They are growing fast but off a very small base. We need to do things that meet demand as it exists and then evolve as demand evolves.
Will it ever make sense for Chevron to stop looking for places to drill and focus its efforts on renewable energy sources?
One day, I’m sure it will make sense to do that. Probably a long time from now. When the world stops using oil and gas, we’ll stop looking for it.
But to stop beforehand runs the risk of creating a lot of adverse consequences in terms of the world not having the energy that it needs.
President Trump is eager for energy prices to fall. Is that a good thing for Chevron?
Our company is built to work through cycles, because it’s the nature of the energy business. Prices go up, prices come down, you don’t know when they’re going to do either one.
We have to maintain a healthy portfolio and a strong balance sheet to navigate cycles.
We don’t really run the business based on today’s price or the short-term price. We run it based on a long-term view of markets.
Can you point me to a policy from the Trump administration that has had an impact on your business, good or bad?
I’ll give you a very specific one, and it’s a change from the prior administration.
The United States has tremendous offshore resources in the Gulf of America. Under President Biden, his administration was reducing the number of lease sales and the quality of acreage that was available.
The Trump administration has reversed that and has returned regular lease sales to their program.
That’s a policy change that will ensure that there is a regular flow of exploration opportunities for our industry to go out and see what we can find. That’s a good thing for our economy.
What does Chevron do better than Exxon?
The difference is in the culture of the companies. We put a real premium on partnership. We put a premium on diversity and inclusion. We put a premium on getting the best out of our work force and using that to deliver solutions for communities, governments and customers.
In our industry, strategies are easy to copy. Assets you can buy, technologies you can license. Cultures are harder to build, and they are a differentiator.
Speaking of culture, you moved Chevron’s headquarters to Texas from California. What does that do to the company’s culture?
I don’t think culture is tied to where a company’s headquarters are. It’s really tied to the values of the company.
We’ve got employees in a hundred different countries around the world, and so our culture doesn’t live in a place, it lives in our people and behaviors.
You are cutting 20 percent of the work force. What is it like, as a chief executive, to lay off so many people?
In a commodity business, costs always matter. We have to stay competitive, and the most difficult thing we do is downsize our work force.
The way we protect the most jobs for the most people is by remaining competitive. Companies that don’t remain competitive at some point either don’t exist anymore, or they get acquired by somebody else, or an activist investor comes in and changes things. We have to take control of our own future.
At a time when there’s a discussion about preventing climate change and serving shareholders, how do you want to be remembered as the chief executive of Chevron?
As somebody who was able to balance out all these competing interests.
If you look at some of the European companies in our industry, they have lost a lot of relevance because they embarked on a strategy that said, “We’re going out of the oil and gas business.” It turns out the world is not out of the oil and gas demand business.
These companies took themselves out of being competitive. Their shareholders are unhappy about that. At any public company, but certainly in an industry like ours, we have be very mindful of all of these competing interests. We’re not engaged in idealism. We’ve got to be pragmatic and real.
Do you see the oil and gas industry as a contributor to climate change?
Human activity is a contributor to climate change. We supply energy that is used. If humans did not consume energy or consume oil and gas, we wouldn’t be in business.
But is Chevron able to provide more options or push customers in a different direction?
We’re trying to do that today, with renewable fuels that come from renewable feedstocks, and we’re going to start up one of the world’s largest green hydrogen projects later this year. We’re investing in lithium technology. We’re trying to create choices.
These technologies are more expensive than the current technologies, and so they need to find customers.
Tell me about your upbringing and your parents. You’re from Colorado, and your dad was an executive at Coors.
My dad was not actually on the brewing side. He was a ceramic engineer and was involved in making porcelain products.
My mother was an artist. I had this right brain, left brain upbringing. I wanted to be a journalist at one point, actually. But I was also very good at math and science, and I think that came from my father.
He was a big influence on my career path.
What’s a piece of advice from him that you still reflect on?
It was more of an example that he set. I worked in a factory one summer — graveyard shift from 11 at night until seven in the morning. It was part of the business that made ashtrays, which were distributed to bars and had the Coors logo on them.
My dad had a habit of walking the shop floor. He knew what people’s kids were doing. He knew who won the high school football game on Friday night. Everybody there felt like they knew him. He was just known as Dave.
That was an important lesson for me. Treating everybody with respect and decency was the key to his success, not being a Ph.D.
I’ve heard you are known for writing personalized notes to co-workers.
It’s a simple way to take the lesson that I learned from my father.
When I visit our operations around the world, people prepare for the visit. They explain to me what they’re doing, and they take a lot of time to help me understand their part of the business.
A simple note that thanks them for what they did and acknowledges the specific content that we talked about, says that “I see you, I see what you do, I value what you’re doing, I appreciate it.”
Sometimes I’ll come home and have 70 or 80 or 100 letters to write.
Ready for the lightning round?
Do I have a choice?
Good point, no. How many hours do you sleep?
Five to six hours a night. Let’s call it six., 10 p.m. to 4 a.m.
What app on your phone do you use the most?
Text messaging.
What have you learned from your youngest workers?
How to be optimistic and innovative.
Are you having some trouble with optimism?
No, but they remind me of how optimistic young people are.
If you had to choose another profession, what would it be?
Zamboni driver.
Are you a hockey fan?
I just find the Zamboni to be a very cool machine and the drivers very skilled.
What are you trying to learn about right now?
A.I.
What’s the last thing you asked A.I.?
My last question was about what was the biggest merger in U.S. business this year.
What was it?
Our acquisition of Hess.
Jordyn Holman is a Times business reporter covering management and writing the Corner Office column.
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