BP Abandons Clean Energy Push, Refocuses On Oil

BP has announced a major strategic shift, increasing oil and gas production while cutting back on low-carbon investments.

Despite its renewed focus on fossil fuels, BP will maintain investments in biofuels in Brazil, biogas in the U.S., and electric vehicle (EV) charging in China, the U.S., and Europe. I Photo: bp Facebook

The struggling UK oil major also plans to sell $20 billion in assets by 2027 to reduce debt, Barron’s Daily reporters Brian Swint and Janet H. Cho wrote.

The shift is an effort to win over investors—particularly activist fund Elliott Management—as BP lags behind U.S. rivals ExxonMobil and Chevron in shareholder returns. “It’s a radical shift,” BP CEO Murray Auchincloss said.

BP now plans to boost oil production in the U.S., Oman, the UAE, and Iraq. Since becoming CEO in 2023, Auchincloss has scaled back the company’s hydrogen and biofuel projects, put its U.S. onshore wind business up for sale, increased investments in fossil fuels, and initiated a cost-cutting drive.

BP had pivoted to low-carbon energy in 2020, but this move coincided with surging fossil fuel demand and rising oil prices, driven in part by Russia’s invasion of Ukraine.

Now, the company will slash its annual low-carbon energy investment by $5 billion while increasing its oil and gas investment to $10 billion per year. By 2030, BP aims to produce 2.5 million barrels of oil daily.

Despite its renewed focus on fossil fuels, BP will maintain investments in biofuels in Brazil, biogas in the U.S., and electric vehicle (EV) charging in China, the U.S., and Europe. To reduce debt, BP is also exploring asset sales, including its Castrol lubricants business and a stake in its Lightsource solar unit, The Wall Street Journal reported.