BP halts share buy-backs as annual income slide | BP

BP has halted share buy-backs after reporting weaker annual income because it prepares to proceed a plan to resuscitate its fortunes beneath a brand new chief government.

The corporate’s underlying earnings fell to simply beneath $7.5bn (£5.5bn) for 2025, from virtually $9bn for 2024, after world oil costs fell for a 3rd consecutive yr and on the steepest fee for the reason that Covid pandemic.

It stated it might droop quarterly share buy-backs from traders for the primary time for the reason that early levels of the pandemic, when a worldwide collapse in oil costs compelled the 116-year-old firm to a document loss.

The choice to halt share buy-backs to strengthen its steadiness sheet will pile stress on the corporate to win over traders with a brand new strategic imaginative and prescient after a failed try to pursue a inexperienced agenda.

Its incoming chief government, Meg O’Neill – the previous head of the Australian oil firm Woodside Power – will take up the position in April as BP’s third boss in as a few years and is predicted to implement “rigour” to BP’s turnaround plan. In the meantime, activist shareholders are persevering with to push the corporate to arrange for a long-term decline in fossil gas demand.

Carol Howle, the BP interim chief government, stated the corporate had made progress towards its 4 main targets: to develop its cashflows, to extend shareholder returns, to scale back prices and to strengthen its steadiness sheet by means of asset gross sales.

“There may be extra work to be completed, and we’re clear on the urgency to ship,” Howle stated. “We’re in motion and we are able to and can do higher for our shareholders.”

BP stated fourth-quarter earnings had fallen 30% quarter-on-quarter within the final three months of the yr, to $1.54bn, although this was 32% increased than a yr earlier and according to Metropolis expectations.

BP will even face stress from investor teams, which have criticised the choice to show away from inexperienced investments in favour of fossil gas initiatives.

“BP is in dire straits as a result of the corporate has drifted with no constant strategic path,” stated Mark van Baal, the founding father of the shareholder activist group Comply with This.

The group has filed a decision earlier than BP’s annual investor assembly in April calling for the corporate to reveal its technique for creating shareholder worth beneath situations of declining demand for fossil fuels.

“After a half-hearted power transition, the corporate is now doubling down on fossil fuels in a market that may quickly begin to shrink,” he added. “If BP can not develop income and restore its dividend in a rising market, how will the corporate create shareholder worth in a declining one?”

BP commissioned seven new oil and gasoline initiatives final yr as half its plan to return its focus to fossil fuels after making an attempt to maneuver into huge renewable power investments. 5 of the seven initiatives have been delivered forward of schedule.

Final week, rival Shell reported a 22% fall in adjusted earnings to $18.5bn (£13.6bn) for 2025, however introduced $3.5bn value of share buy-backs – its seventeenth consecutive quarter of not less than $3bn of buy-backs.