BP strategy reset includes ramp up in oil and gas spending, review of lubricants business

BP chief executive Murray Auchincloss has outlined a ’fundamental reset strategy’ for his company, which will see the company drop sustainability targets and spending on the energy transition in favour of targeting a roughly 60% increase in oil and gas production by 2030.

During a capital markets day presentation, Mr Auchincloss told investors the company had gone "too far, too fast" in its commitment to investing in an energy transition that, he said, has been hampered by economic and geopolitical conditions over the past five years.

"In 2020 we made some bold strategic changes, accelerating into the energy transition while progressively reducing our hydrocarbon business. We then saw Covid, the war in Ukraine, a recession, and the shift in attitudes of markets and governments have a fundamental impact on the energy system," Mr Auchincloss said, noting the "lower cost energy won out in most nations, and... our optimism for a fast transition was misplaced, and we went too far, too fast."

BP previewed the move to bolster its spending on oil and gas and to cut investment in low-carbon and renewable energy when announcing its yearly financial results in early February. BP’s earnings report from 2024 showed the company posted its weakest quarter in Q4 2024 for five years, and an overall profit of US$8.9Bn for the full year, representing a drop of more than a third from BP’s 2023 profit results.

“Today, we have fundamentally reset BP’s strategy. We are reducing and reallocating capital expenditure to our highest-returning businesses to drive growth, and are relentlessly pursuing performance improvements and cost efficiency," Mr Auchincloss said in the company’s results presentation.