Joe Wallace of The Wall Street Journal reports that BP is shifting focus back to oil and gas, aiming to increase production to 2.5 million barrels daily by 2030 while cutting clean energy investments by $5 billion. The company plans to sell $20 billion in assets by 2027 to reduce debt. Following pressure from activist hedge fund Elliott Management, this strategy aims to boost its struggling share price. Wallace writes:
BP said it would boost oil-and-gas production and sharply cut investments in clean energy, pivoting back to fossil fuels in a bid to revive its flagging share price.
The struggling British energy company announced the moves Wednesday as part of a much-anticipated strategy update aimed at winning over investors. Those include activist hedge fund Elliott Management, which recently took a stake in BP with a view to pushing for significant changes. […]
BP’s shares have lagged behind those of rivals Shell, Exxon Mobil and Chevron since the company took the most aggressive steps by an oil major to shift toward lower-carbon sources of energy in 2020. That bet backfired when fossil-fuel consumption roared back after the early days of the pandemic and prices rocketed when Russia invaded Ukraine. […]
Auchincloss said BP recognized global warming. “We’re doing an awful lot to help the transition,” he said. “We’re just doing it smarter.”
To reduce its debt pile, the London-listed company said it was targeting $20 billion of asset sales by 2027. The divestments could include BP’s lubricants business, Castrol, which the company said it was reviewing with all options on the table.
BP also suggested it may sell a stake in its solar unit, Lightsource.
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