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2mo ago

BP Resets Strategy, Scaling Back Renewables to Focus on Oil and Gas

The energy giant announces a major shift, cutting renewable investments and increasing fossil fuel production amid shareholder pressure.

The Ruhr oil refinery operated by BP Gelsenkirchen GmbH, a subsidiary of BP Plc, in Gelsenkirchen, Germany, on Saturday, May 21, 2022. Germany plans to stop importing Russian oil by the end of the year even if the European Union fails to agree on an EU-wide ban in its next set of sanctions, government officials said. Photographer: Alex Kraus/Bloomberg via Getty Images
FILE - A sign at a BP petrol station in London, Feb. 7, 2023. British energy giant BP has confirmed it is to slash spending on green ventures and up its oil and gas production. (AP Photo/Kirsty Wigglesworth, File)
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Overview

  • BP will increase oil and gas investments to $10 billion annually, reversing its prior commitment to significantly reduce fossil fuel production by 2030.
  • Renewable energy spending will be slashed by 70%, with projects like biofuels and offshore wind scaled back or sold off, including its U.S. wind business and portions of its solar unit, Lightsource.
  • The shift comes as BP faces mounting shareholder pressure, including from activist investor Elliott Management, which has acquired a 5% stake and is pushing for asset sales and a strategic overhaul.
  • CEO Murray Auchincloss justified the pivot by citing slower-than-expected progress in the energy transition and stronger-than-anticipated global demand for oil and gas.
  • Critics, including environmental groups and sustainable investors, argue the move undermines climate goals and raises concerns about BP’s long-term viability in a decarbonizing world.