Oil giant BP has confirmed it will cut approximately 4,700 jobs, over 5% of its global workforce, as part of a major cost-cutting strategy.
The British energy firm, which employs around 90,000 people worldwide, disclosed the layoffs on Thursday but has not specified how the reductions will be distributed across its operations.
BP announced about 3,000 contractor positions would be eliminated this year. Of these, 2,600 contractors have already departed.
The job cuts will primarily affect office-based roles rather than frontline operational positions.
BP’s 16,000 UK-based employees, including 6,000 working at petrol stations, will not be impacted.
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$2 Billion Cost-Cutting Plan
BP’s chief executive, Murray Auchincloss, is driving the initiative, aiming to reduce costs by $2 billion (£1.6 billion) by 2026. Of this, $500 million is targeted for savings in 2024.
He said:
“We have more work 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.”
As part of this strategy, BP has halted or paused 30 projects since June 2024, redirecting resources toward its most profitable opportunities.
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Digital Transformation and AI Integration
BP is embracing digital transformation to streamline operations, incorporating artificial intelligence into engineering and marketing.
The company is reviewing all divisions to improve efficiency, hinting that further job reductions could follow.
Controversial Climate Policy Shift
BP has faced criticism for scaling back its climate commitments.
Initially, the company pledged to cut oil and gas production by 35-40% by 2030. However, in 2023, it revised its target to a 20-30% reduction while maintaining fossil fuel investments.
Auchincloss, who took over following Bernard Looney’s abrupt departure last year, hopes that these cost-cutting measures will strengthen BP’s financial position and revive its struggling share price, which has fallen about 20% since last spring.
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Future Challenges and Opportunities
While BP aims to enhance its competitiveness in the renewable energy sector, Auchincloss emphasized that success is not guaranteed.
He said:
“We have to keep improving our competitiveness and moving at the pace of our customers and society.”
With its workforce overhaul and shift toward digital capabilities, BP is positioning itself for a leaner, more profitable future. However, with climate commitments under scrutiny and further layoffs possible, the road ahead remains uncertain.
