BP, once worth over £140 billion, has lost almost 25% of its market value in the last two years. Today, its market capitalization is less than half of its peak. While European and US competitors post record profits, BP faces frustrated investors and rising debt. Recently, the company announced it would cut 5% of its global workforce to save billions and win back shareholder trust.
Analysts warn that BP’s lower market value makes it a target for financially stronger competitors. Reports suggest that Elliott Investment Management has already bought a large stake in the company.
Capital Markets Day: A Pivotal Moment
At the upcoming Capital Markets Day in London, CEO Murray Auchincloss will need to present a strong new plan. Experts believe BP may drop its goal to reduce oil and gas production by 2030. Investments in renewable energy, such as electric vehicle infrastructure and bioenergy, might be cut back from the planned $6-9 billion to about $5 billion.
To stabilize, BP may sell assets like US wind farms or Dutch fuel stations. Analysts say these sales could raise up to $8 billion.
New Opportunities or Risk of Takeover?
A renewed focus on oil and gas might take too long to show results. Many experts believe global oil demand will peak in the 2030s. Kim Fustier from HSBC says BP needs a major strategy change to regain investor confidence. “Capital allocation and priorities must be rethought,” she says.
It remains unclear if these measures will stop BP from being taken over. However, a clear shift in strategy could bring stability or create better conditions for a sale.