British Petroleum (BP) has slashed planned investment in renewable energy from $5b per annum to $1.5b-$2b. At the same time it is increasing annual oil and gas spending to $10b. This major strategy shift is evidently to boost earnings and investor confidence. The news was accompanied by a 1.3 per cent fall in its share price.
The company has come under increasing pressure to change strategy. That came after news that U.S. investor, Elliott Investment Management, had built a five per cent stake in the company.
It now aims to grow production to between 2.3 and 2.5 million barrels of oil equivalent per day. The figure for 2024 was 2.36 million barrels.
These are the highlights of the company’s recent investor day. BP CEO, Murray Auchincloss, told Reuters “It’s a radical shift”.
And it is yet another major energy company putting profits ahead of lowering carbon emissions and curbing climate change.
Under the previous CEO, Bernard Looney, BP pledged to cut oil and gas output by 40 per cent while growing renewables. However, he lowered the target to 25 per cent in 2023.
BP also revised its approach to reducing emissions by 20 to 30 per cent between 2019 and 2030. The new target is now 10 per cent over the same period.
Auchincloss said “This is a reset BP, with an unwavering focus on growing long-term shareholder value.”
