Chevron Centralizes Global Operations, Targets $3 Billion Cost Savings by 2026

Chevron Corp. is dismantling most of its regional business units and shifting to a centralized structure that it says will cut annual operating costs by as much as $3 billion by 2026. The overhaul will consolidate key engineering functions in Houston and Bengaluru and move finance, human resources and IT work to shared-service centers in Manila and Buenos Aires. The reorganization could trim the oil major’s global workforce by up to 20%, or roughly 9,000 positions, and reduce the number of upstream business units to as few as five from nearly 20. A single offshore division will manage assets in the U.S. Gulf of Mexico, Nigeria, Angola and the Eastern Mediterranean, while shale operations in Texas, Colorado and Argentina will be combined under one group. Executive vice president Mark Nelson said the slimmer hierarchy is aimed at accelerating project execution, standardizing best practices and deploying new technologies such as artificial intelligence more quickly across the portfolio. Chevron shares are up about 5.8% this year, outpacing the 3.1% gain in the S&P 500 Energy Index as investors continue to reward companies that rein in costs and return cash.