BP to lay off 5% of workforce in $2 billion cost reduction plan

BP announced on January 16 that it will eliminate approximately 4,700 jobs, or over 5% of its global workforce, as part of an ongoing cost-reduction strategy.

The company, which employs around 90,000 people worldwide, has not specified how many of these positions will be affected in each of its operational countries, Caliber.Az reports referring to UK media.

Alongside the job cuts, BP confirmed that approximately 3,000 contractor roles will also be terminated this year. 

BP's CEO, Murray Auchincloss, who took over leadership of the company last year, previously announced his intention to streamline operations. He set a target of reducing costs by $2 billion by 2026, with $500 million of that savings expected to be achieved this year.

In a message to employees, Auchincloss acknowledged the difficult nature of these changes: "We have got more we need to do through this year, next year, and beyond, but we are making strong progress as we position BP to grow as a simpler, more focused, higher-value company." The cuts are expected to affect office-based positions rather than operational roles.

Auchincloss also addressed the emotional impact of the job losses, saying, "I recognize the uncertainty this brings for everyone whose job may be at risk, and also the effect it can have on colleagues and teams."

The company also noted that around 2,600 contractors had already left BP as part of the cuts. This move follows a comprehensive review of all BP divisions, with the company emphasizing its ongoing efforts to streamline operations and enhance digital capabilities, including increased use of artificial intelligence in engineering and marketing.

BP has halted or paused 30 projects since June 2024 as part of its strategy to focus on "highest-value opportunities." The company's shift in strategy has drawn criticism, especially after BP reduced its goal for cutting oil and gas production emissions by 2030, from a target of 35-40% to 20-30%.

Auchincloss, who assumed leadership following the abrupt departure of Bernard Looney, aims to improve BP's competitiveness and share price, which has dropped approximately 20% since spring 2024. Despite challenges, he reaffirmed BP’s focus on growing value through the energy transition to renewables, stating, "We have to keep improving our competitiveness and moving at the pace of our customers and society."

By Tamilla Hasanova