BP Boss Defends Fossil Fuel U-Turn

BP boss Murray Auchincloss has defended the company’s move to increase fossil fuel production and ditch its renewable energy commitments.

Auchincloss is under mounting pressure from BP investors, who are frustrated at the oil major’s underperforming share price.

The executive unveiled plans for a “fundamental reset” two weeks ago, which included ditching a series of green energy targets set out five years ago.

Writing in the Times, he said “unravelling” the pledges had been well received by investors.

“From the many conversations I have been having, our new direction is resonating with shareholders… Most of the questions to me are about how quickly we can deliver,” he said.

BP’s reset will see oil and gas production increase to between 2.3m and 2.5m barrels of oil equivalent per day by 2030. It will also raise spending by around 20 per cent to $10bn (£7.8bn) per year.

The change marks a major U-turn from a prior target of reducing output by around a quarter, from 2019 to 2m barrels per day.

“Our optimism in 2020 for a fast energy transition was misplaced and we went too far, too fast in our plans,” Auchincloss wrote on Monday.

Shares in BP are down around 11 per cent over the last year and have underperformed by comparison to rivals Shell and ExxonMobil.

The pressure on Auchincloss, 54, who replaced disgraced former boss Bernard Looney in 2020, has been intense.

Notorious stakeholder Elliot Investment Management, the New York-based hedge fund led by Paul Singer, owns a near five per cent stake in BP and has pushed fiercely for it to scrap renewable energy projects.

By City AM

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