Global Layoffs Signal Oil & Gas Under Pressure

Source Credit : Portfolio Prints

Industry Under Strain

In recent days, the oil and gas sector has witnessed a wave of high-profile job cuts, signaling a broader structural squeeze across the industry. Key players like ConocoPhillips and Halliburton have announced sweeping layoffs, reflecting mounting pressure from weak oil prices, increased OPEC+ production, rising costs, and ongoing consolidation.

Major Layoff Announcements

• ConocoPhillips is cutting up to 25% of its global workforce—approximately 2,600 to 3,250 jobs—as part of its “Competitive Edge” restructuring program. The company cites rising unit costs, which have climbed from $11 to $13 per barrel since 2021, as a major factor squeezing margins. Layoffs are expected to begin as early as November 10. CEO Ryan Lance took personal responsibility for previously prioritizing acquisitions over cost containment, and the company is targeting $2 billion in cost savings by 2026.


• Halliburton, a top provider of oilfield services, has initiated layoffs across several divisions, affecting an estimated 20% to 40% of staff. These reductions are a response to slumping oil activities, volatile prices, and a sharp decline in second-quarter profits. Brent crude has fallen over 10% this year, compounding the pressure.

Broader Industry Context

This acceleration of layoffs is not isolated:

• Ongoing cost pressure from high production costs, tariffs on steel and aluminium, and weak demand amid elevated OPEC+ output continue to erode profitability across the sector.


• Consolidation trends, driven by M&A activity, are prompting overlaps and redundancies in staffing. For instance, ConocoPhillips’ acquisitions—including Marathon Oil for $22.5 billion—have added pressure to deliver synergies.


• Multiple major firms including Chevron, BP, Petronas, OMV, and SLB are planning or already executing layoffs ranging from 8% to 20% of their workforces, reflecting universal industry recalibration.

Economic and Social Impacts

• Employees and contractors face mounting uncertainty, with entire departments hit and communities in oil-dependent regions like Texas particularly vulnerable to economic fallout.


• Markets are reacting. Shares of ConocoPhillips dropped between 3.7% to 4.5%, while broader energy indices also declined.


• Long-term industry resilience is uncertain. While layoffs aim to realign cost structures, they may also slow production growth and affect supply capabilities, especially if reinvestment lags.

Strategic Fallout and Outlook

In the short term, workforce reductions are expected to curb costs and elevate operational efficiency—but the path ahead remains complex:

• Executives remain hopeful long-term demand will sustain the industry’s recovery. Conoco’s leadership expects oil demand to rise again over the coming years.


• Cost control and technological adaptation are now central to strategic planning. Streamlining operations, divesting non-core assets, and embedding tech-driven efficiencies are pressing priorities.


• Energy transition pressures also loom large, with expectations for companies to increasingly invest in renewables, LNG, hydrogen, and carbon capture as traditional oil ventures become costlier and less certain.

Summary Table

Driver	Impact
Low oil prices & OPEC+ output	Shrinking margins, driving cost cuts and layoffs
Rising input costs (tariffs)	Higher production costs, especially in U.S. operations
M&A consolidation	Redundancies across merged entities, prompting workforce rationalisation
Industry-wide restructuring	Major firms trimming staff, investing in efficiency
Social & economic implications	Worker displacement, community hardship, slower production potential
Long-term direction	Focus shifting toward resilient, technology-driven, and low-carbon strategies

This is a defining moment for the oil and gas sector—one where cost discipline, strategic clarity, and adaptability will determine who emerges resilient in an increasingly challenging landscape.