Roustabouts, roughnecks and petroleum engineers in US oil fields are facing the deepest job cuts since crude prices crashed three years ago, and the prospects of an upturn any time soon are looking bleak.
Employment slid 1.7% last month to levels not seen since the summer of 2022, according to the Bureau of Labor Statistics, with industry leaders from Chevron Corp. to ConocoPhillips slashing head count to get costs under control.
Three years ago, staff levels shrank in response to increasing pessimism about the pace of post-pandemic demand growth and a potential supply glut that tanked crude prices.
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This time, similar fears are percolating from Houston to London as OPEC+ moves to restore suspended output despite tepid demand signs in some of the largest economies.
Benchmark US crude is down more than 12% so far this year, putting it on track for the worst annual performance since the pandemic emerged in 2020.
US Oil Field Jobs Disappear at Fastest Pace Since 2022
A looming supply glut and weak prices are spurring mass layoffs
This past weekend, the producers’ alliance led by Saudi Arabia and Russia surprised observers with a supply boost that wasn’t expected so soon.
More increases are forecast for coming months, further darkening the outlook for a revival in US shale, where producers unceasingly push to pump more barrels with fewer resources.
“A lot of these jobs are just going to be gone,” said Ed Hirs, an economist at the University of Houston. “There will still be jobs in the oil patch in the US, but it will be fewer jobs.”
Big Oil’s chief executive officers are trying to stay one step ahead of the price gyrations that underpin their bottom lines.
Unlike many of their state-controlled international competitors, US shale bosses not only must cover labor and material costs, but they also have to “return something to the capital markets,” Hirs said.
–Emma Sanchez and David Wethe, Bloomberg News
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