What is the primary reason behind BP's decision to shift focus back to oil and gas production?

BP's decision is driven by a desire to maximize long-term shareholder value, as the company believes its previous focus on green energy transition was misplaced and did not yield the expected returns.

How does this strategic shift affect BP's original net-zero goals?

BP's shift towards oil and gas production raises questions about its commitment to original net-zero goals. While the company still aims to achieve net-zero carbon emissions by 2050, the reduced investment in green ventures may complicate this objective.

What has been the reaction from environmental groups to BP's new strategy?

Environmental groups have sharply criticized BP's decision, arguing that increasing oil and gas production undermines efforts to combat climate change and contradicts legal climate targets.

How has BP's stock performed following the announcement of this strategic shift?

BP's stock price initially declined following the announcement, indicating that investors were not immediately convinced by the strategy change. However, the stock had been rallying in recent weeks on speculation about the shift.

3 sources·Business

BP Shifts Focus Back to Oil and Gas Production, Cuts Green Investments

BP announces a major shift in strategy, reducing green spending and ramping up oil production, sparking criticism from climate activists and concerns among shareholders.

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The strategy reset has come amid growing pressure from investors to shrug off its green pledges, which initially won praise from green groups but have since been diluted as BP’s share price has suffered.
BP to ramp up oil and gas output in major shift away from green goals
The Guardian·1M
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BP's failure to do this has led to active speculation that BP should be taken over by a company that understands this.
BP's shareholders want it to make money, not climate policy
BBC News·1M
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BP's change of strategy is facing sharp criticism from environmental campaigners, who had previously warmed to the company’s insistence that the future was green.
BP to slash spending on net zero ventures as it focuses on oil and gas again
Associated Press·1M
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Updated: Feb 26th, 2025, 12:39 PM ET

Summary

A summary of the key points of this story verified across multiple sources.

BP has announced a significant change in strategy, cutting its green initiatives budget by $5 billion and increasing investments in oil and gas production by 20%. CEO Murray Auchincloss stated the company's focus is on maximizing long-term shareholder value, citing a misplaced faith in the green energy transition. This reversal raises concerns among climate activists who argue it undermines efforts to combat climate change, while some shareholders express anxiety over BP's declining market performance compared to competitors. The company's original net-zero goals set under former CEO Bernard Looney are now in question, prompting calls for stakeholder engagement.

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BP is refocusing its strategy on increasing oil and gas production to strengthen shareholder value, stepping back from aggressive investments in green energy.
The company's leadership acknowledges that the demand for oil and gas will persist for decades, suggesting a more balanced approach between fossil fuels and renewable energy investment may be necessary.
Despite the skepticism from climate campaigners, BP maintains a long-term goal of achieving net-zero carbon emissions by 2050.

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