Houston-based oil giant ConocoPhillips has sent shockwaves through the energy sector with its announcement that up to a quarter of its global workforce will be laid off by the end of 2025. The decision, confirmed on September 3 and 4, 2025, is expected to impact between 2,600 and 3,250 employees and contractors worldwide, according to statements from company spokespeople and reporting by the Associated Press, Reuters, and the Houston Business Journal.
The layoffs are part of a sweeping restructuring effort aimed at making ConocoPhillips more efficient in the face of mounting economic pressures. CEO Ryan Lance, in a candid video message to employees, acknowledged the gravity of the move. "I know these changes create uncertainty, and they are unsettling," Lance said, as quoted by Reuters. "As we streamline our organization and take work out of the system, we will need fewer roles."
ConocoPhillips currently employs approximately 13,000 people globally. The cuts, representing 20% to 25% of its workforce, are set to unfold primarily before the end of the year. The company has not specified how many of the affected jobs will be in Houston, but with about 2,700 local employees, the city—which is considered the energy capital of the world—could see hundreds of positions eliminated.
According to the Houston Business Journal, the Energy Corridor in Houston, home to numerous Fortune 500 energy companies, is likely to feel the brunt of the layoffs. More than 30,000 Katy-area residents commute to this business district, highlighting the ripple effects these cuts could have on the broader community and regional economy.
Driving ConocoPhillips’ decision are rising operational costs and continued volatility in oil prices. Lance pointed out that controllable costs have surged from $11 per barrel in 2021 to $13 per barrel in 2024—an 18% increase. Oil prices themselves have also risen by about $2 per barrel, creating a competitive squeeze. "We are always looking at how we can be more efficient with the resources we have," a company spokesperson told the Associated Press, underscoring the urgency behind the restructuring.
Falling oil prices in 2025 have put pressure not only on ConocoPhillips but also on its major competitors. Chevron, for example, announced in February that it would lay off up to 20% of its staff. Other industry giants, including SLB and BP, have also enacted significant workforce reductions this year. The sector-wide trend is clear: companies are striving to "do more with less," as Dan Pickering, chief investment officer at Pickering Energy Partners, put it in comments to the Associated Press.
ConocoPhillips’ efforts to trim costs are not limited to layoffs. The company has identified over $1 billion in cost reductions and margin optimization initiatives, according to its latest earnings report. In addition, ConocoPhillips agreed to sell its Anadarko Basin assets for $1.3 billion as part of its broader strategy to streamline operations and improve financial health.
The restructuring program, internally dubbed "Competitive Edge," has been guided by the Boston Consulting Group, which was brought in earlier this year to advise on the process. The aim, according to company materials, is to reduce expenses by $1 billion and improve margins by the end of 2026, with about 80% of anticipated cost reductions coming from general and administrative expenses, lease-operating expenses, and travel and entertainment costs.
Financially, ConocoPhillips remains a heavyweight, ranking fifth on the Houston Business Journal's 2025 Largest Houston-Area Public Companies List. The company reported $56.91 billion in revenue for 2024 and $14.74 billion in revenue for the second quarter of 2025—a 4% increase over the same period last year. However, net income for the second quarter of 2025 fell to about $2 billion, the lowest since the early days of the COVID-19 pandemic, reflecting the challenging market environment.
ConocoPhillips’ shares have not been immune to these headwinds. The company’s stock fell 4.3% on the day of the announcement, dropping below $95 per share and marking a nearly 14% decline from a year ago. Since the start of 2025, shares are down 4.7% as of September 3, according to market reports.
The layoffs also follow a period of intense industry consolidation. ConocoPhillips’ $22.5 billion acquisition of Marathon Oil in November 2024 had already led to significant job cuts in Houston, with more than 500 Marathon employees laid off prior to the deal’s completion. The company later doubled its expectations for synergies from the acquisition, aiming for $1 billion in savings instead of the originally projected $500 million. The integration of Marathon Oil’s assets has now been completed, but the aftershocks are still being felt among the workforce.
This wave of layoffs is not unique to the energy sector. The tech industry, too, has experienced significant job losses in 2025. Google recently cut 35% of its workforce, targeting more than a third of its managers responsible for small teams. Scale AI, Intel, and Accenture have also announced major layoffs, with Accenture undergoing a substantial organizational restructure. These developments point to a broader trend of companies across industries reevaluating their staffing needs in response to economic uncertainties, technological advancements, and shifting market demands.
Industry analysts and employee advocates have raised concerns about the human impact of these decisions. The HR Digest noted the "considerable disruption" that abrupt downsizing can cause for remaining employees, who are left to shoulder additional responsibilities and uncertainty. While severance packages and support programs can offer some relief, the prevailing focus on cost-cutting often leaves workers feeling vulnerable and unsettled.
Meanwhile, consolidation in the oil and gas industry shows no sign of slowing. A study by EY, cited by the Houston Chronicle, found that mergers and acquisitions among top publicly traded exploration and production companies surged 331% in 2024, totaling over $206 billion. This included five "megadeals," each valued at more than $10 billion, such as Exxon’s acquisition of Pioneer Natural Resources. The result has been thousands of job losses industry-wide, especially in Houston, where many of these companies are headquartered.
As ConocoPhillips and its peers navigate these turbulent times, the impact on workers, communities, and the broader economy remains profound. With efficiency as the guiding principle and technology increasingly replacing traditional roles, the workforce faces a future marked by both challenge and change. For now, the energy sector—and Houston in particular—will be watching closely to see how these historic layoffs reshape the landscape.
