Energy giant BP is to launch a major cost-cutting programme after Q1 profits were hit by falling gas prices and a refinery outage and earnings fell short of analyst forecasts.
ADVERTISEMENTBritish oil and gas company BP's first quarter profits were below expectations, as underlying profit came in at $2.7 billion (€2.5 billion), compared with $3 billion for the previous quarter.
This was partially due to falling gas prices and an unplanned outage in the company's Whiting refinery in the US, partially offset by strong oil trading.
Production of oil and gas was up by 2.1% from a year earlier to 2.4 million barrels-of-oil equivalent per day.
BP's net debt increased to $24 billion (€22.3bn) from $20.9 billion in the last quarter.
The London-based firm held its dividend at 7.27 cents per share, the same as the last quarter.
BP said that it would embark on a major cost-cutting exercise and plans to simplify its organisational structure with the aim of shaving off at least $2 billion in costs by the end of 2026.
"We are simplifying and reducing complexity across BP and plan to deliver at least $2 billion of cash cost savings by the end of 2026 through high grading our portfolio, digital transformation, supply chain efficiencies and global capability hubs," said Murray Auchincloss, chief executive officer.
BP also pledged to keep the rate of its share buyback programme, spending $1.75 billion in the second quarter and aiming to return to the shareholders a total of $14 billion by the end of 2025.
