February 28, 2024


Profits at the energy company BP halved last year to nearly $14bn (£11bn), but were better than expected after weaker oil and gas market prices caused revenues to slump across the industry.

BP said it would return more cash to investors with $3.5bn of share buybacks over the first half of this year, and at least $14bn over the next two years. The move prompted criticism from campaigners who said the money would be better spent on investing in the green transition.

“Shareholders should want to protect their long-term positions. That means demanding a rapid clean energy transition for companies like BP. These reckless shareholder payouts do the opposite,” said Jonathan Noronha-Gant, a senior campaigner at Global Witness.

Joseph Evans, a researcher at the thinktank IPPR, said: “BP has decided to prioritise its shareholders over investing in the green transition. With profits down on last year, you might expect BP’s executives to be looking for profitable investments in the growing industries of the future, like renewable energy. Instead, they’ve chosen to enrich their investors.”

The energy company’s underlying profit for the final quarter of last year was almost $3bn and $13.8bn for the full year – still its second highest annual profit since 2012 despite halving. It beat City forecasts of $2.8bn for the quarter and $13.6bn for the full year.

Although the company beat expectations, its full-year profits were down sharply compared with 2022, when soaring global energy market prices helped BP to a full-year profit of $28bn.

The latest financial results were the first to be delivered by BP’s new chief executive, Murray Auchincloss, since he took up the role on a permanent basis last month.

The former chief financial officer acted as BP’s interim chief executive from September last year after the shock departure of Bernard Looney, who stepped down after failing to fully disclose to the board a series of personal relationships with his colleagues.

Auchincloss said BP’s strategy to transform from an integrated oil company to an energy company, set up by Looney in 2020, would remain unchanged and would focus on growing the company’s value.

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“We are confident in our strategy, on delivering as a simpler, more focused and higher-value company, and committed to growing long-term value for our shareholders,” Auchincloss said.

BP is under pressure from the activist hedge fund Bluebell Capital Partners to drop its plan to curb its future oil and gas production. The London-based hedge fund wrote to BP shortly after acquiring a small stake in the company last September, arguing that its strategy has depressed its share price and presumed a “drastic decline in oil and gas demand, which we consider to be utterly unrealistic”.

BP shares rose 5% after the better than expected results were announced, making it the top riser on the FTSE 100 on Tuesday morning.



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