17 January 2025

Written by Ron Busso

LONDON (Reuters) – BP said on Thursday it would cut more than five percent of its global workforce, part of Chief Executive Murray Auchincloss's efforts to cut costs and rebuild investor confidence in the energy giant.

About 4,700 employees and 3,000 contractor jobs will be cut this year, BP (NYSE:) told Reuters. The cuts were announced in an internal memo seen by Reuters earlier on Thursday.

BP shares rose 1 percent by 1200 GMT.

Auchincloss said last year that he would cut the British company's costs by at least $2 billion by the end of 2026 to boost returns and address investor concerns about its energy transition strategy.

He was also seeking to restore trust after the shock resignation of his predecessor Bernard Looney in September 2023 over his failure to disclose relationships with staff.

The job cuts follow reviews of all BP divisions. BP's workforce is approximately 90,000 people.

“We have a lot more to do over this year, next year and beyond, but we are making strong progress as we position BP to grow as a simpler, more focused, higher-value company,” Auchincloss said in the memo.

The exact details of the cuts were not revealed. But in a separate memo sent to his team by BP's chief technology officer, Emeka Emembolo, he predicted that around 1,100 jobs would be cut through redundancies or by moving work from the UK and US to Hungary, India and Malaysia.

BP declined to comment on the memo.

Shares in the group have underperformed most of its rivals over the past year, down more than 5%, similar to French rival TotalEnergies (EPA:) and compared to gains of 5.5% for Shell (LON:) and Exxon Mobil (NYSE:) profit 14%.

Auchincloss, who took office a year ago, is scheduled to present his new strategy at Investor Day on February 26.

He has already taken big steps to reverse his predecessor's strategy of moving away from oil and gas.

As part of new efforts to reduce exposure to renewables, BP and Japanese power generation company JERA agreed last month to join forces to form one of the world's largest offshore wind operators.

© Reuters. FILE PHOTO: Signs are seen outside a BP (British Petroleum) gas station in Liverpool, Britain, February 7, 2023. REUTERS/Phil Noble/File Photo

Rival Shell has also reduced its workforce in recent years as part of a cost-cutting drive led by CEO Wael Sawan. The cuts included a 20% cut in the oil and gas exploration division and cuts in the low-carbon division.

BP will publish fourth-quarter and full-year results on February 11.

Leave a Reply

Your email address will not be published. Required fields are marked *