Aiming to cut costs and streamline operations amid expansion efforts and a legal dispute, Chevron plans to reduce its global workforce by 15% to 20% by the end of 2026.
The legal dispute involves ExxonMobil over the acquisition of the Hess Corporation.
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The layoffs are set to impact as many as 9,000 Chevron employees. According to the company’s vice president Mark Nelson, “Chevron is taking action to simplify our organisational structure, execute faster and more effectively, and position the company for stronger long-term competitiveness.”
The restructuring plan will save Chevron between $2 billion and $3 billion. Despite the job cuts, Chevron continues to expand its global footprint.
In December 2023, the company announced a $53 billion deal to acquire Hess Corporation, an acquisition that will give Chevron a big stake in Guyana’s Stabroek Block. However, the deal has encountered legal challenges.
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ExxonMobil, with its 45% stake in the Stabroek Block, initiated arbitration proceedings, claiming a right of first refusal to acquire Hess’s assets in the region. The outcome of the dispute, expected by late 2025, will determine whether Chevron can finalize the Hess acquisition.
Chevron told investors the workforce reductions will not impact its ability to meet production targets. The company forecasts a 6% to 8% increase in total oil and gas output for 2025, building on a record output of nearly 3.34 million barrels of oil equivalent per day (mmboe/d) in 2024.
Growth is expected to be strongest in the Permian Basin, where Chevron anticipates a 9% to 10% increase in production, despite reduced capital investment in the region.
Chevron’s capital expenditure (capex) budget for 2025 is between $14.5 billion and $15.5 billion, reflecting a $2 billion decrease compared to the previous year.
Chevron is also participating in bidding for Guyana’s crude marketing contracts, alongside BP and Shell.
The company operates Block 58 offshore Suriname, holding a 40% interest. QatarEnergy has 20%, and Paradise Oil Company, an affiliate of Suriname’s national oil company Staatsolie, holds the remaining 40%. Chevron is also set to drill the Korikori-1 well in Block 58 during the fourth quarter of 2025.
