BP announces major additional job cuts

The British multinational oil and gas company BP expects to cut around 15 percent of its corporate workforce this year, or 6,200 jobs, which is significantly more than the 4,700 jobs it said it would be cutting earlier this year.

The job losses will come from the company's 40,000 office workers.

BP, which is headquartered in London, England and that employs around 100,000 people globally, said it will review its operations and costs before deciding on the final number of jobs it will shed.

It is making the move in a bid to increase efficiency and cut costs so it can further improve profitability, which has lagged behind investor expectations recently.

"BP can and will do better for its investors," the Financial Times newspaper quoted the company's chief executive, Murray Auchincloss, as saying.

He added that he will "conduct a thorough review" of BP's situation alongside incoming chairman Albert Manifold, who previously led the Irish building materials company CRH for 10 years and who will start at BP on Sept 1.

Auchincloss described Manifold as "hardcore focused on returns, value, and efficiency" and said the review will ensure BP can make the most of significant successes it has had recently, including the discovery of vast oil and gas fields in Brazil and Africa.

"You just never plan on this amount of success, so we need to think about resource allocation," he told the paper.

The company angered some climate activists in February when it announced it was scaling back spending on the development of clean energy and increasing oil production in order to make cost savings of between $4 billion and $5 billion against its 2023 expenditures and therefore increase its profits.

But some investors were disappointed at the time that the company was not looking to make additional savings, and BP's share price has remained around 10 percent lower ever since.

The Evening Standard newspaper said shareholders called on the company to do more to curtail costs, and pressure from them, led by activist investor Elliott Management, which recently took a 5 percent stake in the group and led to the need for additional cuts, especially in light of BP's profits being hit by weaker oil prices in recent months.

BP also reported its second-quarter results this week, with its adjusted profits for the period a third up on analysts' expectations, which triggered a 2.6 percent rise in its share price on Tuesday.

While underlying profits of $2.35 billion for the period between April and June were down 15 percent year-on-year, they were significantly better than the $1.38 billion posted by the company in the first quarter.

In another move aimed at calming shareholders, BP, which is listed on the FTSE 100 index, said it will buy back another $750 million of its shares and increase its quarterly dividend payout by 4 percent.

earle@mail.chinadailyuk.com