U.S. oil and gas producer ConocoPhillips is set to reduce its workforce by 20-25% as part of a restructuring plan announced by CEO Ryan Lance. The company’s shares have dropped 4.2% to $94.91, reflecting the challenges faced by the third largest U.S. oil producer in the current economic climate.

Rising costs, particularly a $2 increase per barrel, have left ConocoPhillips lagging behind its competitors and necessitated the workforce reduction. The company aims to make most of the job cuts before the end of the year, affecting between 2,600 and 3,250 employees. ConocoPhillips’ net income has also seen a decrease, prompting the need for cost reduction and margin enhancement measures.