BP is set to announce a reduction in its renewable energy investments, shifting focus towards increasing oil and gas production. This decision comes amid pressure from investors dissatisfied with the company’s lower profits and share price compared to competitors. Shell and Equinor have already scaled back their green energy investments, while U.S. President Donald Trump’s pro-fossil fuel stance has encouraged similar moves. BP previously aimed to cut oil and gas production by 40% by 2030, but lowered this target to 25% in 2023. Now, it plans to abandon this goal entirely, cutting renewable investments by more than half, according to CEO Murray Auchincloss. In 2024, BP’s net income dropped to $8.9 billion from $13.8 billion the previous year. Auchincloss faces pressure from shareholders, including activist group Elliott Management, which holds a near £4 billion stake, to boost oil and gas investments. Since 2020, BP’s shareholders have seen returns of 36%, significantly lower than Shell’s 82% and Exxon’s 160%. This underperformance has led to speculation about a potential takeover or relocation of BP’s stock listing to the U.S. Some investors, however, oppose this shift. Last week, 48 investors urged BP to allow a vote on any plans to move away from renewables. Environmental group Greenpeace UK warned of resistance if BP doubles down on fossil fuels. AJ Bell analyst Russ Mould described this as a pivotal moment for BP, emphasizing the need to address operational and share price challenges. BP has placed its offshore wind business in a joint venture with Jera and may sell other non-core businesses. This strategy marks a significant reversal from its previous “Beyond Petroleum” initiatives. — news from BBC.com
