In a significant move amid ongoing challenges in the oil and gas sector, ConocoPhillips has announced plans to reduce its global workforce by 20 to 25%, affecting thousands of employees. This restructuring comes as the company grapples with declining oil prices, rising operational costs, and the need to streamline operations following its recent acquisition of Marathon Oil. The layoffs, which will primarily impact both employees and contractors, are expected to be largely completed by the end of this year.
ConocoPhillips, one of the largest independent exploration and production companies in the world, employs approximately 13,000 people globally. The cuts could result in 2,600 to 3,250 job losses, with the company aiming to achieve over $1 billion in cost reductions and margin improvements. This is in addition to the $1 billion in savings already realized from the Marathon Oil deal completed last year. Company spokesperson confirmed the restructuring in a statement, noting that costs per barrel have risen from $11 in 2021 to $13 in 2024, while U.S. crude futures have dropped about 11% this year. Second-quarter net income fell to around $2 billion, the lowest since early 2021.
The announcement has sparked reactions across the industry, highlighting broader pressures on oil producers. For instance, a LinkedIn post by Mark S. Christian, a Houston-based professional, went viral with the headline “Drill Baby Drill? Thousands of oil workers getting pink slips as ConocoPhillips cuts 25% of its workforce. Chevron cutting 20%. (This is just the beginning.)” In the post, Christian references a Reuters article and points out similar cuts at other majors like Chevron (up to 20%), SLB, and BP (over 7,000 staff, or 5% of its workforce). He emphasizes the irony amid calls for increased drilling, as falling prices force companies to curb spending and reduce drilling activities. ConocoPhillips has scheduled a town hall meeting for employees on Thursday morning at 9 a.m. Central Time to discuss the changes.
This wave of layoffs is not isolated to ConocoPhillips. The oil industry has seen similar actions in recent months, driven by market volatility and the need for efficiency. Earlier reports from July indicated potential impacts in areas like Bartlesville, Oklahoma, where ConocoPhillips has operations, possibly affecting hundreds locally. The company’s shares fell following the news, reflecting investor concerns about the sector’s outlook.
As the energy sector navigates these turbulent times, ConocoPhillips’ restructuring underscores the need for adaptability in a market influenced by global demand shifts, geopolitical factors, and the transition toward cleaner energy. Energy News Beat will continue to monitor developments and their implications for workers, investors, and consumers alike.
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