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May 27, 2020

Chevron sees job cuts up to 15% in pullback affecting thousands

The Chevron Corp. logo is displayed at a gas station in Dallas, Texas, U.S., on Wednesday, July. 26, 2017. Chevron Corp. is scheduled to release earnings figures on July 28. Photographer: Bloomberg/Bloomberg

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Chevron Corp. is planning a 10 per cent to 15 per cent reduction in its global workforce this year, the biggest cut to headcount yet among global oil majors following the COVID-19 pandemic.

The company aims to reduce costs to ride out the worst crude-price crash in a generation. Among other big oil companies, BP Plc is reducing senior management roles ahead of a further announcement in June, while Royal Dutch Shell Plc is offering voluntary redundancies. Exxon Mobil Corp. has said it intends to cut operating costs by 15 per cent, not including layoffs.

Chevron’s cuts equate to about 6,000 of its 45,000 non-gas station employees. It’s “streamlining our organizational structures to reflect the efficiencies and match projected activity levels,” the San Ramon, California-based company said Wednesday in a statement. “This is a difficult decision, and we do not make it lightly.”

Chevron plans to strip US$1 billion of operating expenses this year in addition to slashing capital spending by almost a third. Even before the pandemic, Chief Executive Officer Mike Wirth was leading a cost-cutting drive.

Job reductions will be “across the board but heavy on the corporate functions and the support functions,” Chief Financial Officer Pierre Breber said in a May 1 interview. But field workers may also be affected because lower oil prices mean “lower activity levels,” he said.