Oil price decline · tariff hikes · industry restructuring fallout…oil industry lays off thousands

Oil price decline · tariff hikes accelerate cuts in the oil industry

Exxon, Chevron, Conoco enact workforce restructuring after large-scale acquisitions

U.S. oil companies are cutting thousands of workers in response to falling crude prices, high tariffs, and a wave of mergers and acquisitions across the industry.

CNBC cited recent Bureau of Labor Statistics (BLS) data on the 30th (local time), reporting that industry jobs fell by 4000 through August. Although President Donald Trump promised a boom in the oil and gas industry when he took office in January, analysts say layoffs have continued.

The backdrop to the cuts is an international oil price decline. West Texas Intermediate (WTI) prices have fallen 13% so far this year and traded below $63 per barrel. This is below the breakeven point for profitably drilling new wells.

Accordingly, the three major U.S. oil companies—ExxonMobil, Chevron, and ConocoPhillips—completed large acquisitions over the past two years and have carried out cuts this year. ExxonMobil announced 2000 layoffs. Chevron in February announced plans to cut up to 20% of its workforce by 2026. ConocoPhillips announced earlier this month plans to cut up to 25%. Across the entire energy sector, 9000 jobs were lost through August, a 30% increase in cuts compared with the same period last year. Meanwhile, new hiring has effectively stopped this year. Energy companies' hiring plans are about 1000 people, a 90% plunge from 12,000 in the same period of 2024.

Shale oil company executives warned that President Trump's pressure to lower oil prices combined with steel tariffs that increase costs could ultimately lead to large-scale job losses.

One executive, speaking anonymously in a Dallas Federal Reserve quarterly survey, said, "The government is pushing for $40 per barrel oil while imposing tariffs on imported pipe products, driving up input costs," adding, "This will eliminate new drilling." He added, "The oil industry will again lose valuable personnel."

Another executive criticized the administration, saying, "The administration is effectively aligning with OPEC+'s policies and pushing U.S. producers below economic viability," and, "Rather than supporting domestic production, it is undermining the U.S. shale industry in line with OPEC's supply strategy." This executive also pointed out that "large companies like Exxon, Chevron, and Conoco are pushing out the small independent entrepreneurs who led the shale revolution."

In fact, Exxon acquired Pioneer Natural Resources for 60 billion dollars. Chevron bought Hess for 53 billion dollars, and Conoco acquired Marathon Oil for 17 billion dollars. He said, "In the end, a few giant companies have come to dominate the market, but the cost has been massive job losses and the collapse of innovative, risk-taking entrepreneurship."

A White House spokesman emphasized that President Trump "has rolled back regulations that choked the industry," noting that his policies helped record crude production in June. Energy Secretary Chris Wright defended the administration's policies, saying, "The administration is cutting regulations to lower drilling costs."

New York=Park Shin-young, correspondent nyusos@hankyung.com