Chevron will slash 15% to 20% of its workforce as the oil major implements a plan to lower costs, the company announced Wednesday.

The layoffs will begin this year with most of the cuts complete before the end of 2026. Chevron is looking to reduce costs by between $2 billion and $3 billion by the end of next year, according to the company.

Chevron had a total headcount of 45,600 employees as of December 21, 2023, according to its most recent annual filing. If the number of employees at the end of 2024 was similar, slashing its workforce by 20% would result in more than 9,000 layoffs.

″We do not take these actions lightly and will support our employees through the transition,” Chevron Vice Chairman Mark Nelson said in a statement. “But responsible leadership requires taking these steps to improve the long-term competitiveness of our company for our people, our shareholders and our communities.”

Chevron shares were trading more than 1% lower Wednesday. The stock is up more than 7% this year.

The company missed Wall Street’s fourth-quarter earnings expectations, as its fuel business posted a loss of $248 million compared with a profit of $1.15 billion in prior year, as refining margins have fallen.

Its pending $53 billion acquisition of Hess Corp. is also tied up in arbitration with competitor Exxon Mobil, creating uncertainty about whether the deal will close.

Chevron is in the midst of relocating its corporate headquarters to Houston from San Ramon, California.