Author: Ron Bousso
LONDON (Reuters) – BP will cut more than 5% of its global workforce, it said on Thursday, as part of Chief Executive Murray Auchincloss’ drive 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 were up 1% at 12:00 GMT.
Auchincloss said last year it 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 also sought to restore trust after the sudden resignation of his predecessor, Bernard Looney, in September 2023 for failing to disclose relationships with employees.
The job cuts followed a review of all BP departments. BP has around 90,000 employees.
“We still have work to do through 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 a memo.
An exact analysis of the cuts has not been published. But in a separate memo sent by BP’s technology chief, Emeka Emembolu, to his team, he predicts around 1,100 jobs will be cut through layoffs or relocation of work from the UK and US to Hungary, India and Malaysia.
BP declined to comment on the letter.
Shares in the group have underperformed most of its rivals over the past year, falling more than 5%, similar to French rival TotalEnergies ( EPA: ) and compared with a 5.5% gain for Shell ( LON: ) and Exxon Mobil (NYSE: ) gained 14%.
Auchincloss, who took over a year ago, will outline his new strategy at an investor day on February 26.
He has already taken major steps to reverse his predecessor’s strategy away from oil and gas.
As part of a new push to reduce exposure to renewables, BP and Japanese power producer JERA agreed last month to join forces to form one of the world’s largest offshore wind operators.
Rival Shell has also cut its workforce in recent years as part of chief executive Wael Sawan’s cost-cutting drive. The reductions included a 20% reduction in its oil and gas exploration division and cuts in its low carbon division.
BP will announce its results for the fourth quarter and full year on February 11.
