Chevron Corp. intends to reduce its global workforce by 15% to 20% by next year to cut costs and enhance profits, potentially impacting up to 9,000 employees. Recently relocating its headquarters to Houston, the company aims for structural cost reductions between $2 billion and $3 billion by 2026. This move reflects a broader trend in the oil industry post-pandemic, characterized by a focus on profitability over staff growth, as evidenced by similar cuts at Exxon Mobil Corp. The actions aim to strengthen Chevron's competitive position in the market for the long-term.
Chevron is taking action to simplify our organizational structure, execute faster and more effectively, and position the company for stronger long-term competitiveness, said Vice Chairman Mark Nelson.
The cuts will put further pressure on US oil and gas job numbers, which are still about 10% below pre-pandemic levels despite domestic production rising close to a record high.
Mike Wirth has expressed his desire to focus on harvesting cash-flow coupled with modest spending on new projects over the next few years.
The stock dropped 0.75% by 12:46 p.m. in New York, compared with a 1.5% decrease in the S&P 500 Energy Index.
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