Big Oil is taking a tougher stance in labor negotiations, with BP and Marathon using refinery lockouts to push for concessions from unionized workers. Refineries are continuing to operate with contractors and replacement workers, potentially weakening unions’ traditional bargaining power over skilled labor. BP’s six-month Whiting refinery standoff could set a precedent for future industry labor disputes as oil majors continue aggressively cutting costs despite surging profits.
The biggest oil companies in the United States are playing hardball in unionized labor negotiations in a bid to get more concessions from workers’ unions in the new contracts. Over the past few years, some of the top U.S. refining companies have resorted to lockouts to ensure most of the company management’s proposals in new labor contracts are accepted. This trend began earlier this decade with Exxon locking out in 2021 as many as 650 workers out of the Beaumont refinery for 10 months, marking the longest labor dispute at a U.S. refinery in four decades.
Five years later, BP and Marathon are currently in a similar position, locking out workers at their Whiting, Indiana, and Martinez, California, refineries, respectively, amid labor disputes over union contracts. The refineries continue to operate with contractors, supervisors, and replacement workers. The continued operations show that Big Oil is not afraid to use replacement staff while seeking concessions from the unions.
One of the most powerful bargaining tools of the unions—that skilled unionized labor is essential for operations—is being undermined. BP’s lockout at the Whiting refinery since March 2026 over contract disputes suggests that the biggest oil firms are willing to run operations with replacement workers to get the union workers to accept proposals. BP offers an average 13% raise, or over $7 per hour, over four years, but the proposed 13% raise for the first two years is below the national oil bargaining standards.
BP also wants to transfer some non-core craft line work to incumbent specialized third-party contractors, and has proposed a clear waiver of bargaining rights in two proposals: one regarding the use of AI tools and technology, and another concerning the use of time clocks. Eric Schultz, president of United Steelworkers Local 7-1, stated BP is running the same playbook as Exxon did in its dispute in 2021. BP has hired Jordan Marcks, the former Exxon management official who oversaw the Beaumont lockout, as lead negotiator in the Whiting dispute.
The nearly six-month-long standoff at the Whiting refinery has shown that the biggest oil firms are willing to operate with replacement workers to secure union acceptance of their proposals. The outcome of the Whiting refinery dispute could change how the oil majors approach labor contracts and disputes in the future. It also shows that Big Oil continues its push to cut costs and remain competitive, even as the last six months have yielded huge profits in their upstream, refining, and trading businesses amid the spike in oil prices and disrupted crude and fuel supply from the Middle East.
BP’s earnings more than doubled for the second quarter from a year earlier due to higher oil and gas prices, stronger refining margins, and supply disruptions in the Middle East, boosting underlying earnings to $5.7 billion, above analyst expectations. CEO Meg O’Neill is focusing on simplifying BP’s business to prioritize the most profitable assets and create shareholder value.
