bp abandons goal to cut oil output, resets strategy
10/8/2024 2:00:00 PM
bp has abandoned a target to cut oil and gas output by 2030 as CEO Murray Auchincloss scales back the firm's energy transition strategy to regain investor confidence, three sources with knowledge of the matter said.
When unveiled in 2020, bp's strategy was the sector's most ambitious with a pledge to cut output by 40% while rapidly growing renewables by 2030. bp scaled back the target in February last year to a 25% reduction, which would leave it producing 2 MMbpd at the end of the decade, as investors focused on near-term returns rather than the energy transition.
The London-listed company is now targeting several new investments in the Middle East and the Gulf of Mexico to boost its oil and gas output, the sources said.
Auchincloss took the helm in January but has struggled to stem the drop in bp's share price, which has underperformed its rivals so far this year as investors question the company's ability to generate profits under its current strategy.
The 54-year-old Canadian, previously BP's finance head, has sought to distance himself from the approach of his predecessor Bernard Looney, vowing instead to focus on returns and investing in the most profitable businesses, first and foremost in oil and gas.
The company continues to target net zero emissions by 2050. "As Murray said at the start of year... the direction is the same – but we are going to deliver as a simpler, more focused, and higher value company," a bp spokesperson said.
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