BP is shifting back towards its fossil fuel roots, abandoning plans to invest more in renewable energy. The move comes as shareholders grow impatient with the company’s strategy, citing lower returns from renewables compared to oil and gas.
In 2001, BP rebranded itself “Beyond Petroleum” as part of a transition to cleaner energy. However, under CEO Bernard Looney, the company accelerated this shift five years ago with ambitious targets to cut oil and gas production while increasing investment in wind and solar.
However, investors are now pushing for a return to traditional oil and gas production, citing higher profits in these sectors. Shell has reportedly outperformed BP’s renewables efforts, with Exxon’s investors receiving four times the returns.
BP’s board is under pressure from impatient shareholders who want the company to maximize value, not pursue climate change goals. A minority of shareholders disagrees with the strategy shift, but their voices are being drowned out by those demanding a return to drilling and investing in oil and gas.
Critics argue that BP’s approach will lead to “stranded assets” – oil and gas reserves that become unusable due to growing environmental concerns. However, some investors see it as the company’s job to prioritize profits over climate goals.
Source: https://www.bbc.com/news/articles/c0mw1yw3kyvo