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6d ago

BP Slashes Buyback as Tariffs Drive Oil Prices Below Target

The energy giant reports weakened profits, rising debt, and lowest cash flow since 2020, while facing mounting pressure from activist investor Elliott.

Signage is seen outside a BP (British Petroleum) petrol station in Liverpool, Britain, February 7, 2023. REUTERS/Phil Noble/File Photo
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BP and other oil majors have been hit by a recent slump in crude prices

Overview

  • BP reduced its quarterly share buyback from $1.75 billion to $750 million as Brent crude prices fell below $70 per barrel, attributed to U.S. tariffs under President Donald Trump.
  • The company's Q1 2025 underlying profit of $1.38 billion missed analysts' expectations of $1.53 billion, reflecting a challenging financial environment.
  • Net debt surged by $4 billion from the previous quarter, while cash flow from operations hit its lowest level since late 2020.
  • Activist investor Elliott, holding a near 5% stake in BP, is pressuring the company for deeper spending cuts and divestments, targeting $20 billion in free cash flow by 2027.
  • BP continues to pivot away from its abandoned 2020 green energy strategy, refocusing on oil and gas development under CEO Murray Auchincloss.