Oil giant BP cuts thousands of jobs to slash costs – Markets

LONDON: British energy giant BP on Thursday said it would axe 4,700 staff jobs, or about five percent of its workforce, and is cutting thousands of contractor roles to reduce costs.

The move is part of a “multi-year programme to simplify” the group and improve performance, BP said in a statement.

It comes as BP chief executive Murray Auchincloss puts emphasis on oil and gas to boost profits, scaling back on the group’s key climate targets since taking the helm one year ago.

“We have got more we need 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,” he said in an email sent to employees and seen by AFP.

Speaking about the job cuts, which include more than 3,000 contractor roles, he added:

“I understand and recognize the uncertainty this brings for everyone whose job may be at risk, and also the effect it can have on colleagues and teams.”

BP, which has around 90,000 permanent staff based around the globe, indicated that more job reductions were on the horizon.

“We expect around 4,700 roles to be impacted… accounting for much of the anticipated reduction in our headcount this year,” the company said.

“We are also reducing our contractor numbers by more than 3,000 — with 2,600” positions having already ended.

The company’s share price rose around one percent in early afternoon deals on London’s top-tier FTSE 100 index, which was trading higher overall.

Auchincloss, who took the top job after the departure of Bernard Looney, announced last year “at least” $2.0 billion in cost savings by the end of 2026.

He added in Thursday’s statement that 30 projects have been stopped or paused since June to focus on the “highest value opportunities”.

The company is looking to boost its share price which lags behind that of other oil majors, including rivals Shell, ExxonMobil and Chevron.

BP last month said it would “significantly reduce” investment in renewable energy through to 2030, as it separated out its offshore wind operations into a standalone joint venture with Japanese power company Jera.

That echoed an announcement by rival Shell that it will no longer develop new offshore wind projects.

BP and Shell recently reported falls to their third-quarter profits and are set to announce annual results in the coming weeks.