BP reported a quarterly profit of £943 million on Tuesday, falling short of expectations and marking its lowest in four years.
The company said it plans a "fundamental reset" of its strategy, days after reports that Elliott Management had taken a stake in the oil major.
Like other oil companies, BP has faced lower earnings in 2024 following record profits in the past two years, as energy prices stabilised and global oil demand weakened. However, BP has underperformed compared to its peers, increasing pressure on CEO Murray Auchincloss to make changes.
Its shares were up 0.6 per cent at 467.90 pence shortly after the market opened. On Monday, BP shares had risen sharply after reports of Elliott Management’s undisclosed stake, which investors expected would push for strategic changes.
Fourth-quarter profit dropped 61 per cent compared to the previous year, marking BP’s weakest results since Q4 2020, when the pandemic reduced global oil demand.
"We now plan to fundamentally reset our strategy and drive further improvements in performance, all in service of growing cash flow and returns," Auchincloss said in a statement.
Auchincloss has been working to regain investor confidence after the sudden resignation of his predecessor Bernard Looney in September 2023 over undisclosed relationships with employees.
BP’s quarterly earnings were impacted by lower realised refining margins. Its fourth-quarter average refining marker margin was $13.1 per barrel, down from $18.5 per barrel a year earlier.
The company expects refining margins to remain low in the current quarter and foresees a lower level of refinery turnaround activity compared to Q4.
BP's underlying replacement cost profit, its measure of net income, fell to £943 million for the three months ending 31 December, down from £2.41 billion a year ago.
Analyst forecasts had estimated £1.02 billion in a company-provided survey and £968 million based on LSEG data.
(With inputs from Reuters)
