The biggest U.S. Oil companies are eliminating thousands of jobs

ConocoPhillips of Houston announced plans to reduce its global work force by up to 25 percent, ‘The New York Times’ reports.

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.

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.

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.

read more in our Telegram-channel https://t.me/The_International_Affairs