Chevron layoffs come as energy giant unlocks more crude with far fewer rigs in the heart of the U.S. oil patch.
You don’t have to “drill, baby, drill” to get more oil out of the ground—which is something Fortune 500 company Chevron and the overall U.S. energy sector have figured out over the years.
On Wednesday, Chevron said it will lay off up 20% of its global workforce amid efforts to trim $2 billion to $3 billion in costs by 2026. Rivals like BP have also announced job cuts recently as crude oil prices have come down from highs seen three years ago, when Russia’s invasion of Ukraine rippled through energy markets.
But oil companies have been doing more with less in recent years as their focus has shifted from growing output to returning more capital to shareholders. Despite the increased discipline on spending, U.S. oil production has kept hitting new record highs.
The most recent data shows U.S. oil production has reached 13.5 million barrels a day, up 55% from 2014. At the same time, the number of U.S. drilling rigs has plunged to 586 from more than 1,900 in 2014. While the rate of growth is expected to slow, more oil will keep gushing out. Earlier this week, the Energy Department raised its forecast for 2025 to nearly 13.6 million barrels from its prior view for 13.55 million.
Source: FORTUNE
