BP Announces Global Workforce Reduction to Cut Costs

BP, one of the world’s leading energy companies, has revealed plans to reduce its global workforce by over 5% in a bid to streamline operations and boost investor confidence. The decision, announced by CEO Murray Auchincloss, will see the elimination of around 4,700 employee positions and 3,000 contractor roles by the end of the year.

Auchincloss, who took over as CEO last year, aims to cut costs by at least $2 billion by 2026 to improve returns and address concerns over the company’s energy transition strategy. The move comes in the wake of his predecessor’s resignation due to undisclosed relationships with employees, shaking investor trust in the company.

The workforce reduction follows a comprehensive review of all of BP’s divisions, with the company currently employing around 90,000 people worldwide. Auchincloss emphasized the need for further measures to position BP as a simpler, more focused, and higher-value organization.

While the exact breakdown of the job cuts remains undisclosed, an internal memo hinted at potential redundancies and relocation of work to countries like Hungary, India, and Malaysia. The company’s technology division head, Emeka Emembolu, projected around 1,100 roles to be affected by these changes.

BP’s stock has lagged behind its competitors in the last year, prompting Auchincloss to unveil a new strategy at an upcoming investor day. The company has already taken steps to shift focus back to traditional oil and gas operations, including a recent partnership with Japanese firm JERA to establish a major offshore wind venture.

Comparable moves have been witnessed in the industry, with rival Shell also implementing workforce reductions as part of a broader cost-cutting initiative. Auchincloss’s strategy shift marks a departure from the previous emphasis on renewables, aligning BP with market trends and investor expectations.

The company is set to release its fourth-quarter and full-year financial results on February 11, shedding further light on its performance amid the ongoing industry transformation.