BP to review business strategy under new chair amid investor pressure
It has been announced that BP are to review their business strategy when incoming chair Albert Manifold officially joins the company in September. Chief Executive Murray Auchincloss said he and Manifold had agreed to “conduct a thorough review” of BP’s operations and costs to ensure better returns for shareholders. The news came alongside stronger-than-expected Q2 results, adjusted profits of $2.4 billion, a 4 per cent dividend increase, and a $750 million share buyback plan.
This move marks the second time in just over a year that BP are to review their business strategy in response to investor dissatisfaction with the previous strategic overhaul. Earnings benefitted from nearly 3 per cent higher oil and gas production, offsetting a 10 per cent drop in oil prices since Q1. Nonetheless, activist investor Elliott Management, holding a 5 per cent stake, continues to push for a further $5 billion in cost reductions beyond BP’s existing targets.
Last year BP pledged to cut $4–5 billion in costs by 2027, pivoted back toward oil and gas investment, and outlined plans to raise $20 billion via asset sales. So far, it has delivered $1.7 billion in savings and £3 billion in disposals. Yet speculation remains over whether BP will proceed with the sale of its lubricants unit, Castrol, under the new strategic review.
Although the share price has climbed more than 8 per cent over the past month, beating Shell’s roughly 4.9 per cent gain, the real test is whether this fresh review means BP are to review their business strategy in more than name only. Analysts like RBC Capital’s Biraj Borkhataria suggest clarity and bold action are needed to satisfy sceptical investors.
For more on investor activism and UK energy sector leadership changes, see our analysis of boardroom dynamics at top firms or explore why shareholders demand transparency and focus. Detailed financial reporting can be found on BP’s official Investor Relations website.
Despite the robust performance in Q2, the upcoming leadership change at BP presents a pivotal moment. With shareholders pressing for results and the industry shifting, the new chairmanship could mark a genuine reset, or merely another chapter in a stalled turnaround.
For more updates on business & finance, head to EyeOnLondon. We’d love to hear what you think about BP’s next move – have your say in the comments below.
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