BP profits have tumbled in the first quarter of this financial year – as climate campaigners blasted the firm’s move away from green investments as “not only planet-wrecking but financially wrong-headed too”.
Profits for the oil giant, which earlier this year abandoned its ambitions to be a world leader in green energy, fell 49% year on year to $1.38 billion, short of analyst’s forecasts.
Its net debt has risen by $4bn to $27bn since the end of last year because of weaknesses in its gas marketing and trading business, the company said.
Activist investors Elliott Management, which took a 5% stake in the company this February, have been putting pressure on the company to boost profits by expanding oil and gas production and more than halving its investment in renewable energy.
Patrick Galey, of green pressure group Global Witness, said: “BP has spent the last year flip-flopping on its climate commitments, lurching back towards fossil fuels just as the world needs a clean energy transition.
“The fact that its returns are now dwindling and investors seem to be losing confidence shows BP’s climate U-turn is not only planet-wrecking but financially wrong-headed too.”
He added that it was time for investors to “change direction”, saying: “Continuing to back fossil fuel giants as the world moves towards safer, cleaner, home-grown energy is a decision that could leave them empty-handed in the years ahead, with falling demand and billions’ worth of stranded assets.”
Robert Palmer, deputy director of campaign group Uplift, said: “Despite endless claims to be driving the green transition, oil and gas majors have shown their true colours time and time again. BP joins many of its peers in rolling back on renewables of late, many of whom have sought to capitalise on Trump’s denial of climate change.
“We know that just seven of the 87 offshore oil and gas companies operating in the North Sea plan to invest anything in renewables by 2030.”
He said that the fossil fuel industry “cannot be trusted to facilitate a fair and rapid energy transition”, adding: “The UK Government should recognise these rollbacks for what they truly are - concrete evidence that fossil fuel majors have no interest in shifting to more affordable clean energy and take responsibility for this task out of their hands.”
But BP appeared to be sticking with its focus on fossil fuels at the expense of renewables as the profit hit was announced.
Chief executive Murray Auchinloss said: "In February, we announced a fundamental reset of our strategy – to grow the upstream, focus the downstream and invest with discipline in the transition – and we have already made significant progress.
“So far this year we have started up three major projects, made six exploration discoveries and have progressed our divestment programme – all while delivering strong operational performance, with over 95% upstream plant reliability supporting the best operating efficiency on record, and over 96% refining availability.
“We continue to monitor market volatility and changes and remain focused on moving at pace.”
