Locator: 49017COP.
Updates
September 6, 2025: shortly after posting the original blog, this popped up, not a good look. Link here. Social media, via ChatGPT, suggests investors are getting antsy. Reminder, under CEO Lance, PSX has acquired Marathon Oil, Concho Resources, and Shell's assets in the Permian. With those acquisitions, PSX may yet prevail. A lot of good assets.
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Under Lance’s watch, unit costs have risen from $11 to $13 per barrel, and the company announced plans to cut 20%–25% of its workforce (about 2,600 to 3,250 people) to save $2 billion by 2026.
Original Post
I cannot make sense of this. I can't explain it. ChatGPT is not helpful. But why is COP cutting 25% (or possibly even more) of its global workforce?
First thoughts:
- COP has way too many employees, even way more than its competitors, on a relative basis;
- COP sees the coming downturn in oil prices to be more severe than anyone else so far imagines;
- COP sees their own company's financial situation as more dire than how analysts see COP;
- COP is getting ready to reorganize; sell non-core assets;
- COP is getting ready to be acquired, making themselves more attractive to some other oil and gas operator (E&P, refiner) that wants to grow their own company, and do that by acquiring another fossil fuel company.
- a change in leadership often results in such changes, e.g., through reorganizations, but in this case, the current COP CEO has been in place since 2012.
None of those possibilities look good, except perhaps the "M&A" angle.
So, I don't know. But cutting one's workforce by 25% (or more) certainly got my attention.
