In the last couple of years, the largest U.S. oil companies gobbled up smaller ones. Now, contending with persistently mediocre oil prices, those giants are laying off many workers in hopes of squeezing more fuel from the ground at lower cost.
The latest is ConocoPhillips of Houston, which said on Wednesday that it would cut up to 25 percent of its global staff, or as many as 3,250 people, most of them this year. The company employs around 13,000 people, including contractors.
“We are always looking at how we can be more efficient with the resources we have,” Dennis Nuss, a company spokesman, said in a statement.
ConocoPhillips’s announcement, reported earlier by Reuters, comes almost a year after it closed a $17 billion acquisition of Marathon Oil, which was part of a deal-making spree in the U.S. oil patch. Companies often lay off workers after making big purchases.
The layoffs reflect a nuance in how the Trump administration’s overhaul of American energy policy is rippling through fossil fuel companies. While the sector has secured many policy wins this year, from promises of speedier permitting to more frequent lease sales and relaxed emissions regulations, many of those changes will take years to lift their profits.
What affects them today is the price of oil and natural gas. And while gas prices have recovered from record lows in 2024, oil prices have been just OK. Crude now fetches roughly $64 a barrel in the United States and has traded in that ballpark for most of the year. That is enough for most companies to make money drilling new wells, but a lot lower than companies grew accustomed to in the last few years. U.S. oil prices averaged about $77 a barrel in 2024.
Chevron, the second-biggest U.S. oil company, announced plans this year to lay off up to 20 percent of its work force at the time, which would amount to around 9,000 people. Other companies have pursued smaller reductions.
The recent downsizing at big oil and gas companies does not yet appear to be making a big dent in how many people work in the sector overall. The oil and gas services sector, which tends to be the most cyclical part of the industry, employed 2 percent fewer people in June compared with a year ago, federal data show. Pipeline construction jobs, on the other hand, have grown.
Examined over a longer time horizon, though, the American oil and gas industry has been shrinking, even as it has pushed production to record highs.
ConocoPhillips’s stock price was down more than 4 percent Wednesday afternoon, outpacing losses across the rest of the industry.
Rebecca F. Elliott covers energy for The Times.
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