On September 19, despite significant capacity expansion in the US oil and gas industry over recent years, supported by policies promoting fossil fuel development, the employment outlook remains challenging. Major energy companies have been forced to implement layoffs due to oil price pressures and cost constraints, even while investing heavily in acquisitions and business expansion.

Since the pandemic, the US energy sector has witnessed a wave of "mega-mergers," with companies like Chevron, ExxonMobil, ConocoPhillips, and Occidental Petroleum acquiring smaller energy firms to boost production capacity. However, the expansion from these acquisitions has failed to offset profit pressures from oil price volatility, ultimately leading to large-scale workforce reductions.

ConocoPhillips recently announced plans to cut up to 25% of its global workforce, approximately 3,250 employees. The company currently employs around 13,000 people, having just completed its $17 billion acquisition of Marathon Oil last year, significantly expanding both operations and staff. This development illustrates that while energy giants remain active in capital markets, they must resort to layoffs to reduce operational costs and maintain financial stability amid low oil prices. Similar situations are occurring at Chevron, which plans to eliminate up to 20% of its workforce by 2026, equivalent to about 9,000 positions, and has already conducted multiple rounds of layoffs this year.

Low oil prices have become a core constraint for US energy companies. Although oil prices have rebounded recently, they remain well below post-pandemic highs, with US crude averaging around $64 per barrel. This level allows companies to continue drilling operations but significantly reduces profit margins. For instance, ConocoPhillips reported a 15% year-over-year decline in second-quarter profits to $2 billion. Meanwhile, oilfield service giants Halliburton and SLB have also announced layoffs. According to analysis, 22 publicly traded US oil companies collectively reduced capital expenditures by approximately $2 billion in the second quarter.

Additionally, after years of strict production cuts, OPEC+ announced plans to increase output by 137,000 barrels per day starting in October to compete for market share. This move has contributed to international oil prices falling about 12% year-to-date, approaching break-even points for most US companies. Regarding drilling activity, Baker Hughes data shows active US drilling rigs have decreased to 414, down 69 rigs from the beginning of the year. Many companies indicate they will only resume large-scale drilling when oil prices reach $70-75 per barrel.

Overall, US energy giants currently face a situation of "simultaneous expansion and contraction": rapidly scaling up through mergers and acquisitions in capital markets while being forced to cut workforce and investments due to low oil prices and profit pressures. With OPEC+ further increasing production, oil prices may continue facing downward pressure, potentially further narrowing profit margins for US energy companies and leading to more cautious spending plans.