ConocoPhillips and Chevron among producers cutting staff as spending falls by billions
The global oil sector is settling into the reality of $60-a-barrel prices, according to analysts, with many companies cutting jobs and scaling back spending as demand appears to be softening.
Six months ago, major producers were still talking growth, but with prices stuck between $60 and $70, the outlook has shifted. The U.S. shale patch is shedding jobs at its fastest pace since 2022, while ConocoPhillips says it will cut as much as a quarter of its global workforce. The company called the move a reorganization to improve efficiency, though observers see it as a warning sign.
Chevron also announced major staff reductions earlier this year, a move tied in part to its acquisition of Hess Corp., but one that underscored what chief executive Mike Wirth described as a “negative” quarter. Spending plans are also being trimmed. Reuters reports 22 U.S. oil producers, including Conoco, Occidental and Diamondback Energy, have pared a combined $2 billion from budgets.
“We’ve gone from ‘drill, baby, drill’ to ‘wait, baby, wait’ here in the Permian,” Latigo Petroleum CEO Kirk Edwards told Reuters, adding that the layoffs are “a flashing red warning light for the entire U.S. oil and gas industry.”
Analysts at this week’s Asia Pacific Petroleum Conference warned Brent crude could soon dip below $60 and stay there into 2026. Wood Mackenzie projected prices may even fall to $50 for several years, barring a geopolitical disruption, and forecasts global exploration spending will decline 4.3 per cent this year to about $342 billion.
For now, oil producers are doing what they have always done in downturns: cutting jobs, curbing investment and waiting out the slump. Analysts note the industry remains cyclical, and that even after prolonged busts, a boom often follows.
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