The company, which has a global workforce of around 90,000 employees, aims to reduce costs by $2 billion by the end of 2026.

Key Takeaways:

• BP Plc to eliminate 4,700 internal positions and over 3,000 contractor jobs
• Job cuts follow reviews of all of BP's divisions; company has 90,000 employees globally
• Auchincloss plans to announce a shift back toward oil and gas in February strategy update

BP Plc announced plans to eliminate around 8,000 positions, or roughly 5% of its workforce, as part of a cost-cutting strategy aimed at improving investor confidence in the energy giant. The job cuts, which include both internal employees and contractors, follow a series of reviews across all of BP's divisions.

The announcement comes amid pressure from investors who have grown concerned about BP's performance and energy transition strategy. BP's shares have underperformed those of most of its rivals over the last year, and the company's market value is now less than half that of Shell Plc.

The job cuts are part of a broader effort by BP's new CEO, Murray Auchincloss, to reduce costs and reshape the company's focus. Auchincloss, who took office a year ago, has already taken steps to reverse his predecessor's strategy of shifting away from oil and gas. For example, BP recently joined forces with Japanese power generator JERA to form one of the world's largest offshore wind operators.

Auchincloss is expected to announce a more detailed strategy update at an investor day on February 26th. Investors are anticipating a significant shift back toward oil and gas, with a reduced emphasis on renewable energy sources.

The job cuts at BP are part of a larger trend in the oil and gas industry. As companies grapple with lower oil prices and a transition toward renewable energy, many are looking to reduce costs by cutting their workforces. Shell, for example, has also reduced its workforce in recent years as part of CEO Wael Sawan's cost-cutting drive.

The job cuts at BP are likely to have a significant impact on employees. The company has not yet disclosed the exact breakdown of the cuts, but it is anticipated that there will be job losses across all of BP's divisions. The head of BP's technology division has said that around 1,100 roles will be cut through redundancies or by shifting work from the UK and the US to Hungary, India, and Malaysia.