Major Oil & Gas Company Cuts Jobs and Scales Back Renewable Energy in Fossil Fuels
Renewable Energy in Fossil Fuels
Major Oil & Gas Company Cuts Jobs and Scales Back Renewable Energy in Fossil Fuels
According to reports, one of the world’s largest energy companies—which generated over $194 billion in revenue last year—is cutting nearly 5,000 permanent employees and 3,000 contractors. BP, ranked as the fifth most valuable oil and gas company with a market capitalization of $77.14 billion as of December 2024, announced these job cuts as part of a plan to reduce costs by $2 billion by 2026. The layoffs account for more than 5% of BP’s global workforce. According to Sustainability.com, these job reductions are expected to contribute to $500 million in savings this year.
BP, headquartered in London with its U.S. operations based in Houston, hired over 20,000 people between 2022 and 2023—the largest annual hiring increase in the company’s history. However, the additional talent brought in post-COVID did not yield the expected results. In 2023, BP’s revenue stood at $210.13 billion, reflecting a decline of $30 billion (or over 14%) year-over-year. Meanwhile, BP’s stock fell by around 17% in 2024, at a time when its competitor, ExxonMobil—the largest oil and gas company in the U.S.—saw its stock price rise by 5%.
Shifting Focus to Oil & Gas While Scaling Back Renewables
According to an exclusive Reuters report, CEO Murray Auchincloss is expected to inform investors that BP is scrapping its target of increasing renewable power generation capacity 20-fold from 2019 to 2030, reducing the goal to 50 gigawatts instead. Other oil and gas companies have also shifted their portfolios back to traditional fossil fuels, where returns are more predictable. Sources familiar with BP’s latest plans revealed that the company intends to sell off certain assets and scale back some low-carbon investments to reduce debt and boost revenue. Activist investment firm Elliott Investment Management, which owns a 5% stake in BP, has been pushing for stricter cost discipline and changes to BP’s oil and gas operations.
Five years ago, BP’s former CEO, Bernard Looney, had pledged to cut oil and gas production by 40%, aiming for ambitious renewable energy targets. However, in 2023, BP scaled back its planned oil and gas production cuts to 25% instead.
Changes in the Oil & Gas Industry: CEO Takes Action
“We still have plenty of work ahead this year, next year, and beyond, but we’re making great strides in shaping BP into a simpler, more focused, and higher-value company.”company,” Auchincloss wrote in a message to employees.
