The Biggest US Oil Companies Eliminate Jobs as Oil Falls to $64 for $77

ConocoPhillips of Houston on Wednesday announced plans to reduce its global work force by up to 25 percent.

Key Event

· ConocoPhillips (Houston-based) announced it will cut up to 25% of its global workforce — about 3,250 jobs out of 13,000.

· Cuts follow its $17 billion acquisition of Marathon Oil, part of a recent wave of consolidation in the U.S. oil industry.

Context

· U.S. oil companies have been buying up smaller rivals, then trimming staff to cut costs and integrate operations.

· Despite Trump administration policy wins (faster permitting, more lease sales, looser emissions rules), those benefits will take years to impact balance sheets.

· What matters now is commodity prices:

o Oil: $64 per barrel (down from $77 in 2024).

o Gas: recovered from 2024 lows, but still volatile.

Why Layoffs Now?

· Lower oil prices → profits squeezed.

o ConocoPhillips Q2 profit: $2B, down 15% YoY.

o Similar earnings drops at Chevron, Exxon, and others.

· Workforce cuts are a way to maintain profitability after costly mergers.

· Consolidation often leads to redundancies in office staff, engineering, and management.

Industry-Wide Picture

· Chevron is cutting up to 20% of its workforce (~9,000 jobs).

· Other majors are trimming smaller percentages.

· Overall, U.S. oil & gas jobs haven’t collapsed yet:

o Oilfield services: -2% YoY employment.

o Pipeline construction: growing.

· Long-term trend: Fewer jobs overall, even as U.S. oil production hits record highs — showing technology gains and efficiency are reducing labor needs.

Market & Investor Reaction

· ConocoPhillips stock fell 4% after the layoff news — worse than peers.

· Investors see cuts as necessary but worry about sustained low oil prices.

Big Picture Takeaway

· The U.S. oil industry is producing more with fewer people.

· Consolidation + efficiency gains → higher output but shrinking employment.

· Trump-era deregulation hasn’t offset the core problem: oil prices aren’t high enough to restore the profit margins companies enjoyed just a few years ago.

· This suggests a “leaner” oil industry going forward, with fewer jobs even if production grows.

[ABS News Service/06.09.2025]

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 profits.

What affects the companies 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.

Lower oil prices have hurt profits, which fell 15 percent year over year at ConocoPhillips, to $2 billion in the second quarter. Earnings also dropped at other large oil companies.

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 earlier, 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.