British energy leading company set to reverse pledge to reduce oil, gas production
(MENAFN) Struggling British energy company BP is set to reverse its pledge to reduce oil and gas production and will refocus on fossil fuels in a bid to restore investor confidence, according to the Financial Times. The announcement is expected during BP’s investor day on Wednesday.
CEO Murray Auchincloss, who took over in 2023, has faced pressure from US activist investor Elliott Management to turn the company around, especially after BP’s share price lagged behind competitors. Elliott, holding a 5% stake in BP, has been pushing for cost cuts, asset divestments, and a stronger emphasis on profitability.
As part of the shift, BP is likely to announce significant asset sales, and Auchincloss has promised a “fundamental reset” of the company’s strategy. Analysts view this moment as critical for the company, given Auchincloss’s association with the previous strategy that aimed for a 40% reduction in oil and gas output by 2030.
In 2023, BP lowered this goal to a 25% reduction in response to investor pressure, and it is now expected to scrap this target entirely. There are also indications that BP could sell off some of its renewable energy assets and potentially increase oil and gas production.
CEO Murray Auchincloss, who took over in 2023, has faced pressure from US activist investor Elliott Management to turn the company around, especially after BP’s share price lagged behind competitors. Elliott, holding a 5% stake in BP, has been pushing for cost cuts, asset divestments, and a stronger emphasis on profitability.
As part of the shift, BP is likely to announce significant asset sales, and Auchincloss has promised a “fundamental reset” of the company’s strategy. Analysts view this moment as critical for the company, given Auchincloss’s association with the previous strategy that aimed for a 40% reduction in oil and gas output by 2030.
In 2023, BP lowered this goal to a 25% reduction in response to investor pressure, and it is now expected to scrap this target entirely. There are also indications that BP could sell off some of its renewable energy assets and potentially increase oil and gas production.
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